Which Gas Saving Tips actually Work, and Which Don’t?

Even though gas prices have been dropping steadily over the last few weeks, gasoline still isn’t exactly cheap. If you do a lot of driving and you’re looking for the best gas saving tips, you’ve probably heard quite a few of them because, frankly, there are millions of blog articles about gas saving tips scattered all over the web (including from us).

Recently however we began to wonder if all of those tips actually work, and did some research to find out which ones did and, more importantly, which ones did not. This blog will enlighten you and hopefully lighten the load on your wallet the next time you go to fill up your car’s tank.

Gas Saving Tip #1: Driving Slower – YES

This is one of the biggest tips that you’ll find on almost all blogs and it simply says that if you drive at slower speeds you will definitely save money on gas because your car will use less of it.  This tip is, in fact, quite true. The difference between driving just 10 miles an hour slower can save you upwards of 12 to 15%  on gas.  The fact is, one of the biggest problems that most people have when driving, especially long distances, is that they don’t give themselves enough time to get where they are going on time, and thus need to speed to get there.

If most people give themselves a little bit of extra time they would save a lot of money because they would be able to drive slower. Also, driving slower is quite a bit safer.

Gas Saving Tip #2: Using Cruise Control – YES

Another tip that you frequently see on gasoline saving tip blogs is that using cruise control is a great way to cut down on wasting gas. It’s true and not only does it help save gas, it also forces drivers to take the “long view” of any road they’re driving on, which helps them to react less to the various changes in traffic and prevent surging, which wastes gasoline.

Gas Saving Tip #3: Driving Aggressively rather than Calmly – YES

Interestingly, one of the biggest factors in whether or not you can save gas while driving is, surprise, you. Many people are such aggressive drivers, mashing their foot down on the gas at lights and stop signs, driving much too fast and accelerating when they should actually be taking their foot off of the gas pedal and slowing down, that they waste gas by the gallon. The people who look far ahead when they’re driving and anticipate stops and starts and coast whenever possible save much more on gasoline than their aggressive counterparts.

Gas Saving Tip #4: Using the AC versus Opening the Windows – NO

Many readers will be very glad to know that, especially in the dog days of summer, using the AC rather than opening the windows doesn’t affect your gas mileage or gasoline use very much at all. Yes, the AC compressor does waste a small amount of gas but, in today’s modern cars, it’s quite minimal.  When faced with the decision to save a very small amount of money while you roast in a hot car, or spend just a bit more and drive comfortably, the choice should be quite clear  (unless  you’re ridiculously frugal.).

Gas Saving Tip #5: Keeping your Tires Properly Inflated – NO

Okay, this one is a bit tricky. The fact is, tires are quite expensive and keeping them properly inflated is the best way to make sure that they last as long as possible. On the other hand, a slightly over or under-inflated tire isn’t going to really make a difference in your gas mileage at all. So, as far as gas saving is concerned, you don’t have to be a freak about worrying if your tires are properly inflated. On the other hand, if you don’t want to spend money more often on purchasing new tires, keeping them properly inflated and checking them regularly is a good idea.

The Biggest Investing Mistake that Many Consumers Make

Whether you’re buying your first stock or you’ve purchased many over many years, you’ve probably done a lot of research and calculations and, if you’re like most investors, you keep track of whether your stocks are going up or down.

Like many investors, if your stock price goes down, you more than likely hold onto it thinking that it’s just a temporary setback, might be undervalued and will more than likely go up soon. In some cases you might even consider purchasing more of the same stock.

As those days turn into weeks and months however, and your stock keeps losing value, you might want to consider something that most investors don’t; selling that stock at a loss.

This unfortunate trait even has a name; the “disposition effect”. What it means psychologically is that humans don’t like to admit that they’ve made a mistake (and thus are losing money) because, well, it’s too depressing. Instead most investors simply ignore the losers in their portfolio and focus on the winners.

Interestingly, when it comes to mutual funds, most investors don’t have nearly as big a problem of selling the losers that they have in their portfolio because they can blame someone else for its poor performance, including the fund manager.

The reason  for the difference between the way humans treat loser stocks and loser mutual funds is something called “cognitive dissonance”. What it means is that, when something happens that goes against the way we  think the world should be (our “worldview”), many humans have a very hard time accepting the fact that they made an investment decision that was “bad”. It’s even worse for people who believe themselves to be the kind that make “good” decisions.

The lesson to be learned today is simply this; don’t let your ego get in the way of making a good decision. While holding onto the shares of a particular company that still shows promise is usually a good idea, holding onto a stock that keeps dropping in value week after week, month after month, probably isn’t.

Interestingly, if you can convince yourself that someone else is to blame for the “bad” stock that you own, say the person who recommended it to you or the analytical model that you used  when you made your purchase decision, it might be easier for you to dump that stock. Yes, it sounds a bit silly, but if it works it’s better than holding onto a loser stock that lowers the overall performance of your portfolio.

Of course there’s always the fact that you could own up to your bad investment decision and, quite frankly, that’s the healthiest choice. It seems like the most difficult for many investors however, so if you can do it, you definitely should pat yourself on the back.

Top 5 Reasons that Using a Credit Card is better than Using a Debit Card

Millions of American consumers, if asked, will expound on the advantages of using a debit card, including the fact that it’s handy, saves them from not carrying around large amounts of cash in their pocket and  helps them to not overspend.

On the other hand, using a credit card has a number of benefits that, in some cases, outweigh the benefits that using a debit card has. We put together the Top 5 reasons in today’s blog. Enjoy.

Reason #1: Protection from Fraud

Let’s face it, there are a lot of crooked people around who steal credit cards on a daily basis.  One of the best things about using a credit card however is that the federal government has protection laws in place for consumers to make sure that, if their credit card is stolen and used illegally, they don’t have to foot the bill.

If, for example, your stolen card is reported before a purchase is made, you won’t be liable for any unauthorized use and, if not, you’re only on the hook for $50 worth of any fraudulent transactions.

With a debit card, funds are typically withdrawn directly from your bank account. What that means is that, if a thief gets a hold of your debit card, they can steal thousands of dollars before you even realize that your card is stolen and “freeze” your account. After two days the amount of money you’re liable for is $500 and, after 60,  you’ll be responsible for everything that was stolen.

Reason #2:  Renting a car  or booking a hotel room is much easier

While it’s true that you can rent a car or make a hotel booking with the debit card, the fact is that they both will place a hold, usually in the amount of a few hundred dollars, on your debit card in order to do it. Depending on how much money you actually have in your bank account, this might be a problem as it “freezes” that money and you won’t be able to use it.

With a credit card they do something similar but, since the money isn’t actually taken out of your bank account, all of the money in your account will  still be available.

Reason #3:  You can use a credit card to build your credit history

Using a debit card has obvious benefits but, in most cases, it won’t help you build a credit history. A credit card will however and, if you use your credit responsibly and pay your bills on time, keep your credit-ratio low and don’t overspend, your reward will be better interest rates when you go to get a mortgage or car loan and even on new credit cards as well.

Reason #4: Credit cards help you to avoid many fees

Using a debit card means, in many cases, paying for swipe fees on individual transactions and, if you use more money than you have on your card, overdraft charges from your bank. If you use a credit card you can avoid many of these fees.

Reason #5: you can get Rewards points with a credit card

Frankly, as long as you pay your balance in full every month and don’t overspend, you can stay out of debt using credit cards and, even better, get rewards that you can use to purchase other things, get frequent flyer miles and so forth.  In fact, some credit cards have fantastic reward programs and, if you don’t use credit cards, you’ll never be able to take advantage of them.

3 Items You Thought You Had to Pay Full Price for But Don’t

Sure, you can be a savvy shopper and buy most of your clothes, shoes, and food on sale or on clearance.  But there’s a limit, right?  You can’t buy certain things at a discount.  Paying full price for some items, especially expensive, highly coveted items is just a way of life.

Right?

Not so fast.

If you dig carefully, you’ll find there’s a way to save money on almost EVERY product you buy.

Technology.  A technology habit can be an expensive habit, but even for those who don’t have to have the latest or greatest, keeping up with technology can be expensive.  However, you can find clever ways to cut the cost.

For instance, Apple products almost never go on sale.  (There’s no need for a sale!  People snap up the products, sometimes faster than they can be made.)  Despite this, you can still save on Apple products by using a variety of strategies like using a cash back credit card and taking advantage of employer discounts.  In fact, you’ll likely be surprised by the many ways you can save on Apple goods.

Housing.  Sure, if you’re buying a house you know that you should try to negotiate for a lower price.  Yet, most people don’t know that you also have negotiating power when renting an apartment.  This is especially true if you have an excellent credit score.  Most landlords would rather negotiate with a potential renter who will be a trouble-free tenant that will pay on time rather than one who doesn’t negotiate the price of rent but later doesn’t pay her bills on time.

You can negotiate for a reduction in rent or for other perks.  During our last apartment search, we found a place that we loved that was slightly out of budget.  We tried to get the monthly rent reduced, to no avail, so we walked away.  Imagine our surprise, when, after a few weeks of interviewing less than stellar potential tenants, the owner called us back and offered us the price at the advertised rate, BUT he would pay all utilities.  We snatched up the apartment and lived there 2.5 years and never paid one utility bill.

Cars.  You might know that you should negotiate when buying a new car, but few people actually enjoy the negotiating process.  To get the best deal, you will need to negotiate, but there are other ways you can save money, too.

First, consider buying in October.  This is when the car companies are rolling out next year’s models, and they’ll cut the price of this year’s models to clear out the old inventory.

Second, go through a program like Costco’s.  Costco offers members a number of perks, one of which is their auto program.  Costco states they will get you within $500 of the lowest price possible.  If you’re a hard core negotiator, this probably won’t be good enough, but for people who don’t like to negotiate, this program is a great way to score a good deal on a brand new or certified pre-owned vehicle.

Don’t make the mistake of assuming that there are some products that you just must pay full price for.  Clearly, that isn’t true.  Happy bargain shopping!