Posted on July - 05 - 2011

When Spending More May Actually Save

Trying to save money sometimes feels downright impossible. No matter how much money you put aside in a savings account, it seems some new expense always comes up. It’s for this reason that some spenders just don’t bother trying, and prefer to embark on wild shopping sprees rather than penny pinch their way through life.
If you don’t feel comfortable with keeping your bank accounts at near-red levels but think spending a little extra wouldn’t hurt every now and then, consider making key purchases that could actually save you more in the long run. Here are a few ways you can do it:

Pay More for Quality Items

Sometimes it feels good to be the thrifty shopper when buying items you really need. However, if that thrifty spending results in low-quality products that you will have to replace right away, you’re just wasting money.

To avoid this problem, focus on purchasing high-quality items when you can, including solid-wood furniture that could last a lifetime, electronics that offer strong reputations and long-term warranties and even essential wardrobe pieces that cost a bit more but will last. This means you should do your best to avoid trends, gadgets and infomercial products that fall into the category of impulse buys.

Consider Hybrid Vehicles

Another purchase that could actually save you money down the line is a hybrid vehicle. Automakers say that you receive immediate savings at the gas pump, which is a definite bonus. Of course, since hybrid vehicles can cost at least $10,000 more than base models, it could take a while to recoup the difference.
The good news is that if are able to take advantage of the tax credit for hybrid vehicles and actually keep your car for a while, you will eventually see savings start to stack up. Keep in mind that you must purchase the vehicle before Dec. 31, 2010 to qualify for a credit, though.

Make Your Home Energy Efficient

In addition to providing tax breaks for hybrid vehicles, the government offers tax breaks for some who make an effort to create energy-efficient homes. Here are just a few ways to save:

  • Change your refrigerator: According to Energystar.gov, refrigerators made before 1993 cost around $50 more a year to operate, while those made before 1980 cost $150 more. New Energy Star-qualified model refrigerators require less energy to run, saving you money in the long run. In addition, you could get up to 30 percent or $1,500 in Federal tax credits for your purchase.

  • Update your home insulation: If you purchase the best insulation (fiberglass or cellulose fiber) for your home, you could shave hundreds of dollars off of your energy bills every year. Not to mention you could qualify for tax credits for these items as well.

  • Install new HVAC: By installing more efficient heating, ventilating and air-conditioning units in your home, you could end up saving 20 percent on your energy bills every year. Again, possible tax credits are the icing on the cake.

Saving money has a lot to do with developing budgeting skills, as well as practicing will power when the urge to spend frivolously strikes. That doesn’t mean you have to lead a meager existence, however. Spending money is fun, so be strategic about how you do it. The above suggestions aren’t going to make you rich overnight, but spending more money on certain items will yield a little extra for your savings account in the future.

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