Budgeting 101:

Your Money Guide For Getting Through School

Ways to Save Money

Airline Fares

Include a Saturday night stay-over, and you purchase your ticket in advance. You can reduce the price of a round-trip airfare by as much as two-thirds. To make certain you have a bargain fare, even if you use a travel agent, call all the airlines that fly where you want to go and ask what the lowest fare to your destination is. Keep an eye out for fare wars and be prepared to act quickly.

Car Rentals

Car rental rates can differ greatly; shop around for the best basic rates and special offers. Check with your insurance agent and credit card company in advance to see what kind of coverage you have. This way you'll avoid paying for coverage you already have.

New Cars

You can save thousands of dollars during a car's lifetime by choosing a model that couples a low purchase price with low financing and insurance rates. Purchasing a car that has good gas mileage, low maintenance, and repair costs can save you a great deal of money in the future. Find new car guides that contain this information in your local library. Comparison shopping for an automobile can save you hundreds of dollars. Call at least five dealers for price quotes and let each know that you are calling others.

NOTE: Do not let dealers pull your credit report until you are satisfied with the price offered. Too many inquires can look bad on your credit report.

Used Cars

Before buying a used car, be sure to compare the asking price with the Canadian Black Book or the Canadian Red Book price. Also, have a trusted mechanic check the car, particularly if the car is sold "as is." Consider acquiring a used car from a person you know and trust. They will be more inclined to charge a lower price and point out any problems with the car.

Leasing A Car

Consolidated recommends you use the following as a rule of thumb when contemplating leasing a car:

Do not decide to lease a car just because the payments are lower than on a conventional auto loan. Leasing a car can be very complex. Consider the price of the car, your trade-in value, down payment, monthly payments, and miscellaneous fees like, excess mileage, excess "wear and tear", and the cost of buying the car at the end of the lease. Do not lease the same car for more than 4 years. At that stage you are at the "break even point" and you need to decide to take one of the following actions:

• a. Return the vehicle to its rightful owner (the lessor).
  b. Trade your leased vehicle in on a new one. If there is "equity" in the car it should not cost anything to trade it in. This will typically not be the case until you are near the end of your lease (in some cases, you may never have equity).
  c. Purchase the vehicle outright from the lessor, usually for an amount equal to the residual value stated in your lease agreement plus any additional fees.

Auto Loans

If you have considerable savings earning a low interest rate, consider making a large down payment or even paying for the car in cash. This could save you several hundred or thousands of dollars in finance charges.

Shop for the cheapest loan and you may also save hundreds of dollars in finance charges.

Contact several banks, your credit union, and the auto manufacturer's own finance company.

Car Repairs

Each year Canadians lose billions of dollars on needless or inadequate car repairs. To save money on these repairs you must investigate and find a skilled, honest mechanic. Before needing repairs, look for a mechanic who is certified, well established, and has done good work for someone you know - Good luck!

Auto Insurance

Call the provincial insurance department for publications showing typical insurance prices charged by various companies. Find a licensed, low-price insurer. Call four of the lowest-priced, licensed insurers and compare what they would charge you for the same coverage.

An independent website provides additional information and quotes for auto insurance. Visit www.insurance-canada.ca for more information.

You can also get auto insurance comparisons online at www.kanetix.ca/auto-insurance or www.e-insurers.com.

Talk to your broker or insurer about raising your deductibles on collision and coverage to at least $500, or if you have an older car, it might be wise to drop these coverages altogether. Taking these steps can save you hundreds of dollars a year.

Chequing

Save over $100 yearly in fees by choosing a chequing account with a minimum balance requirement that you can, and do, meet. Banks frequently will drop or lower chequing fees if paycheques are directly deposited by your employer. In addition, direct deposit offers the extra advantage of convenience, security, and immediate access to your money.

Savings and Investments

Before opening a savings or investment account with a bank or other financial institution, find out if the account is insured by the federal government. A number of assets offered, including mutual stock funds, are not insured. Guaranteed Investment Certificates (GICs), treasury bills or notes often earn the highest return on savings with little or no risk. However, you may lose access to the money for a period of time.

Credit Cards

You can save as much as several hundred dollars each year by lowering credit card interest charges by paying in full your entire bill each month. If you can not pay off a large balance, consider our Debt Management Program or call 1-800-656-3920.

Consolidated may be able to consolidate your debts, lower monthly payment commitments, and negotiate lower interest charges. Generally, clients see 25-90% monthly savings on interest charges from our creditor negotiations. You can lessen credit card fees by avoiding over-the-credit limit fees and by throwing out all but one or two credit cards that have no annual fee.

Hydro/Electricity

Save hundreds of dollars a year on your hydro/electricity bill by making certain new appliances, especially air conditioners and furnaces, are energy-efficient. Information on the energy efficiency of major appliances is found on the Energy Guide Labels required by federal law.

Heat & Air Conditioning

A home energy audit can identify ways to save money on home heating and air conditioning. Ask your electric, hydro or gas company if they do this audit for free or for a reasonable charge. If they do not, ask them to refer you to a qualified professional.

Telephone Service

Check with your phone company to see whether a flat rate or measured service plan will save you the most money. Check your local phone bill to see if you have optional services you don't really need or use. Each option you drop could save you $40 or more each year.

Long Distance Telephone Service

Evenings or weekend long distance calls can cost significantly less than weekday calls. If you make more than a few long distance calls each month, consider signing up for a calling plan. Call several long distance companies to see which one has the least expensive plan for the type of calls you make. Whenever possible, dial your long distance calls directly. Using the operator to complete a call can cost you an extra $1 to $3.