The Leak: Paying bills by snail mail.
The Fix: The average household receive about 15 bills a month. With stamps now at 42 cents each, you spend about $76 a year just on postage—and don’t forget the late fees if your checks get lost in the mail. Save time and money by signing up with the billers’ customer-service departments to have your bills paid by credit card or automatic debit; payments will be documented on your monthly bank statement. If you want more control, almost all major banks offer free online bill payment, which lets you schedule payments in advance.
The Leak: Paying an annual fee of $60 or more for a frequent-flier credit card.
The Fix: Frequent-flier cards make sense only if you charge $10,000 or more annually. For most people who pay off balances monthly or don’t charge much, a no-annual-fee cash-back card, such as the Citi Dividend Platinum Select MasterCard (
citibank.com) is a wise bet. It offers a 5 percent cash-back rate on grocery, drugstore, and gas purchases for the first six months (and then 2 percent after that) and 1 percent on all other purchases (standard maximum rebate is $300 a year). Other cards may have a higher maximum cash-back reward, but you have to spend more or follow complex rules to earn it. If you carry a balance, forget reward or cash-back cards altogether and opt for a card with a lower interest rate. Switching from a cash-back card with a 17 percent rate to a no-frills card with a 10 percent rate can save you $350 a year on a $5,000 balance. Compare credit-card offers at
bankrate.com.
The Leak: Paying airlines for extras.
The Fix: “Everybody charges for everything nowadays,” says travel expert Joe Brancatelli, whose website,
joesentme.com, chronicles the airline-fee frenzy. Some airlines now charge $15 to check one bag, $20 or more to check a second bag, and the prices escalate from there for additional luggage. Curbside check-in could cost you $2. Almost all domestic carriers charge for meals on domestic flights; US Airways charges $2 for water and other nonalcoholic beverages on domestic coach flights. JetBlue charges $7 for a take-home pillow and blanket. Northwest even charges extra for prime seats. Dodge fees by:
Packing efficiently to limit yourself to one bag. If you can carry it on, even better. Skipping curbside check-in and using a time-saving kiosk or checking in online at home.Bringing your own snacks and meals.
