What happens when you cut out your daily milktea or fancy coffee drink?

Milktea drinks taste so good. Just thinking about the creamy milk, the refreshing tea flavor and the chewy Bobas might have already made you want to grab a cup. Or, perhaps it’s the aroma of coffee that tempts you!

However, have you ever thought about how much the daily store-bought drink costs you? Let’s do the math quickly. Let’s say one drink costs $4.50, and you buy it five times a week. Then the total adds up to $90 per month and $1080 a year. I mean $1080 a year! That gives you more than enough money to purchase a great smartphone!

What if you don’t drink milktea or coffee? Well, these drinks are just an example that shows you how small amounts add up. The most important thing is to identify what the small expenses are that suck your money when you are not paying attention. Similar things can be sweets, late night meals, water from vending machines, etc. Once you identify the small amounts that you spend, add up their total costs for the year. Is it worth it?

For more examples of how small amounts add up, view Small Changes Add Up on our website.

 

Written by: Linxi Liu, Financial Wellness Peer Educator, University of Illinois Extension, 2017

Reviewed by Kathy Sweedler, Consumer Economics Educator, University of Illinois Extension.

How can I save on textbooks?

 

    With the continued increase in tuition and fees, the cost of attending college has become even more burdensome for many college students. In addition to the rise in tuition and fees, according to National Public Radio, the cost of college textbooks has doubled over the past decade. The tuition and fees are predetermined and fixed costs that students do not have control over. However, you do have control over the cost of textbooks and can reduce the textbook expense by shopping wisely.

Buying used textbooks is a great way to cut down on cost. Used textbooks are sold at discounts. The amount of the discount depends on where the textbooks are purchased. In general, the university or online bookstores offer smaller discounts compared to individual student sellers. Some used textbooks are in almost-new condition and some are a bit more worn. For those textbooks that are not in great condition, they often have notes in the margins and highlighted passages which are helpful for studying.

An alternative way to save on textbooks is to purchase electronic versions, also known as e-books. E-books are much more convenient for some students in comparison with hardcover or paperback books. With e-books, you are able to access the books from anywhere and don’t have to carry as much weight with them. In addition, with today’s technology, you can take notes and highlight passages on e-books with ease.

Last but not least, renting textbooks is another great option for you to reduce the textbook expense. Nowadays, more and more bookstores are offering textbook rental services. Both printed and electronic textbooks can be rented from the physical or online bookstores. Renting e-books is typically less expensive than renting printed textbooks. One important thing to keep in mind when renting printed textbooks is that the books must be in the same condition when they are returned. Otherwise, the bookstores will charge extra fees for damages to the books.

 

Written by: Cuihua Lin, Financial Wellness Peer Educator, University of Illinois Extension, 2017

Reviewed by Kathy Sweedler, Consumer Economics Educator, University of Illinois Extension.

What’s a system I can use when doing my holiday shopping?

The holidays can be a time of sensory overload – so much to do, so many events, lights, and people — that it’s easy to become overwhelmed. And, when people are stressed, it’s easy to overspend. To avoid spending more money than you want during the holidays, take time to create a spending plan system that works for you!

What do I need for an effective holiday spending system? I need:

  • To know how much money I want to spend;
  • To know who or what I want to spend money on;
  • A way to track spending; and
  • A way to keep track of what I’ve purchased.

Before you start shopping, think about what kind of system would work best for you. Do you like a(n):

  • app,
  • envelope,
  • small book,
  • budget sheet?

Any of these, and others, can work. Creating a holiday spending system can give you peace-of-mind and help you control your spending, including how much you charge on credit cards. For a free, one page, holiday spending plan form to help you go to http://go.illinois.edu/holidaymoney and click on Control Holiday Credit Card Debt.

Written by Kathy Sweedler, Consumer Economics Educator, University of Illinois Extension.

When should I use my credit card vs. debit card?

Many people are fear of using credit cards because of the risk of overdrafting, high interest rate and fraud. Some of these worries are not necessary. Nevertheless, when we need to swipe our cards, we should choose between credit card and debit card wisely depending on the situation.

Best situations to use credit cards:

  1. Shopping online: Credit cards are highly recommended if you are shopping online. Purchasing by debit card is just like paying cash. It is hard to get your money back once someone else makes a purchase by your debit card online. However, if you purchase by credit card, it is NOT like paying cash. Many credit card companies offer “zero liability” policies, which means that if you dispute a transaction within a few days that wasn’t authorized by yourself, you needn’t pay for it.
  2. Making large purchases: The credit liability policy also works pretty well for large purchases. In addition, some credit card companies offer warranty policies that go beyond the manufacturer.
  3. Making reservations, buying tickets: Many companies only accept credit card online reservations because of safety concerns. Also, it is possible to get discounts or cash-back when you use a credit card to make reservations.

Situations to use debit cards:

  1. Purchasing a small amount of goods: Debit payment is similar to cash payment, so it is more convenient to use a debit card to make routine purchases than a credit card.
  2. Automated payments: some types of payments can made automatically by using a debit card, which can make your life more convenient.

It is still risky to use a credit card without carefully planning. Nevertheless, using credit cards has a lot of advantages that debit cards do not have.

Written by Bowen Song, Financial Wellness Peer Educator, University of Illinois Extension, 2017.

Reviewed by Kathy Sweedler, Consumer Economics Educator, University of Illinois Extension.