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How Starbucks will fund your retirement. On January 7,
2003, President Bush proposed a plan to allow working folks to
put away another $1,000 a month in new tax-free retirement
savings accounts. A great plan—except how will you ever
come up with the money? Here are 10 ideas:
- Kick the Starbucks habit. With
auto-reloading debit cards, it's easy to splurge on a $3.50 venti Toffee Nut Latte. Make coffee in the office
kitchenette instead.
Savings:
$55 a month; $82,000 over 30 years.
Quit the gym. In the time it takes to
drive, park, and change, you can put in a good run that will
do more for you than lounging on the Nautilus, chatting up
pals.
Savings: $40 a month; $60,000 over 30 years.
Pay your bills online. Scheduling payments
via the Web saves you the cost of stamps and prevents late
fees. Use an institution that doesn't charge, like
Bank of America, CitiBank, or E-Trade.
Savings: $30 a month; $45,000 over 30 years.
Ditch your landline. With a cable modem, you
don't need a regular phone line for Internet access.
Switch you cell phone to a plan that doesn't charge extra
for long distance and catch up with your friends and family
wirelessly.
Savings: $35 a month; $52,000 over 30 years.
Eat in. Cooking at home isn't just cheaper,
it's healthier. You can save a bundle by skipping just
one eat-out dinner a month. Savings: $100 a month;
$149,000 over 30 years.
Cancel HBO. Fugghetaboutit, you say?
Consider what you pay for the added tiers of service you're
forced to buy to get the channel.
Rent The Sopranos
on DVD instead.
Savings: $10 a month; $15,000 over 30 years.
Open your junk mail. Some of those credit
card companies are offering
zero-percent balance-transfer
deals that last up to 15 months. Transfer $3,000 from
a card charging 16 percent (and pay it off before the offer
expires).
Savings: $40 a month; until the banks wise up.
Keep the car. You've paid it off.
Hold on to it another few years and you'll have no monthly
payments. Plus, your insurance will be lower because
the vehicle is older. (Keep it long enough and you can
even cancel the comprehensive.)
Savings: $310 a month, for as long as you own it.
Refinance. Surprisingly, despite historic
low interest rates, only half of all outstanding mortgages
have been refinanced. Dropping your rate as little as
from 7 to 6 percent will cut your monthly payment by 10
percent.
Savings (on a $300,000 loan):
$200 a month; $298,000 over 30 years.
Quit smoking. Yeah, yeah, yeah, you know.
We'll spell it out again.
Savings: $150 a month; $224,000 over 30 years.
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