7 Money Tips For February 2011

January is over, with millions of Americans feeling regret over promises made and broken following hasty resolutions made for the new year. Hopefully, those resolutions don’t involve money, but if they do all is not lost. February gives people yet another chance to start anew, perhaps making their first promises of this young year.

To that end, we’ve assembled 7 money tips for the month, ideas to help you consider how to use you money more wisely:

1. Automatic savings — You know that you want to save money, but you just can’t seem to get started. That’s where an automated savings plan can work wonders, siphoning money from your paycheck or checkbook on a regular basis and depositing those monies in a bank savings account. Tip: link your checking account with a savings account at an online institution to avoid the temptation of making a withdrawal when you know you really shouldn’t.

2. Buy a home — If you’re in the market for a new home, 2011 may be the best year to buy one for two reasons: 1) mortgage rates are still low, near historically low levels and 2), home values are low with bargains available in many areas. Avoid the foreclosure unless you’re handy — there should be plenty of other homes available at prices not seen in the past five to 10 years.

3. Pay down debt — Skip the second step if you’re deeply in debt. Instead, work diligently over the next 12 months to pay off or reduce credit card debt and loans. Bring your balances to below 30 percent of your available credit line, a move that will improve your credit score. You won’t be offered one of the current low and attractive interest rates on a home loan if your debt problems loom.

4. Use your rewards — If you have accumulated credit card rewards, consider using those points this year. Some card issuers have reduced rewards or are scaling back on programs, a move that could mean last year’s catalog favorites are no longer available. If you can still stay at a Marriott instead of an Econo Lodge you would now, wouldn’t you?

5. Join a warehouse club — You’ve resisted joining one so far, thinking that the deals found at your local supermarket, WalMart or Target offer the best savings. Certainly, you’ll be required to shell out $35 to $50 for an annual membership, but you’ll get that money back in just two or three visits. Hint: BJs allows you to use coupons too, a great way to extend your savings.

6. Start a garden — Gas prices are through the roof and that means everything else is going up in price. Remember 2008? That is when gas prices jumped above $4 per gallon and the economy soon collapsed. Food prices went through the roof, with many people deciding that home grown foods were a great way to eat right and for less. Start a garden this spring; consider sharing produce with neighbors who have gardens of their own, but grow different vegetables.

7. Plant a tree or two — The benefits of planting a tree may take years to show up, but when they do you will enjoy more shade in the summer, lowering your air-conditioning bill. Besides, a beautiful tree can add value to your most prized possession — your home.

One money tip may not make much of a difference, but several can. Consider doing two or more and adding a few of your own. This time next year you’ll look back and be glad that you didn’t make rash resolutions or at least you made a decision you knew would work out.

by Matthew C. Keegan

DISCLAIMER: Neither Indiana VA Mortgages (IndianaVAmortgages.com) nor NEO Home Loans is affiliated with any government agencies, including the VA.