With layoffs growing and the economy still heading in a downward spiral, many people are seeking advice from those who lived through harder times.
While there are a lot of valuable lessons you can learn from your grandparents, it's important to remember that we live in a different era in which there are a lot of everyday expenses they never had.
This is not an excuse that allows you to avoid getting your finances in order, but a reminder that budgets today tend to have more expenses than they had in years past. That being said, there are plenty of simple ways to save money and even some drastic ones for those willing to truly sacrifice. Here are some expenses you will likely find in your budget that previous generations didn't have to consider.
Cable or satellite TV: There was a time, not too long ago, when TV was free. There were a limited number of channels from the major broadcast networks as well as some local channels. Cable and satellite TV changed all that. A basic package of TV channels costs $240 a year, while premium packages can run over $1,200. There are ways to trim this cost, although you probably won't be willing to give it up completely even though doing so could be worth $1 million.
Internet: Internet access costs at least $120 a year for even the cheapest service and $600 for those who want decent speed. Although this bill is something past generations didn't have, it's actually possible to come out ahead if you use it correctly to take advantage of the money-saving opportunities it offers.
Movie rentals: These days you can see practically any movie you want at home. All you need is a membership at a movie-rental shop or a monthly subscription to a service like Netflix (NFLX) - Get Report (Stock Quote: NFLX) to have the movies delivered to your home by mail. While this is a cost your grandparents didn't have, it can actually be relatively inexpensive if it keeps you from spending money in other ways.
(NFLX) - Get ReportCell phones: It wasn't too long ago when an entire family had one phone and that was a landline in the house. Today, it's common for every family member to have his or her own cell phone, in addition to a house landline. That can mean anywhere from $200 to thousands of dollars a year, depending on the calling plan and the number of teenagers you have. Add fun little apps that can be downloaded for a price, and the cell-phone bill can be a budget-breaker. Spend time to look at how your family is using its cell phones and get the appropriate plan for your calling habits.
(NFLX) - Get ReportCredit cards: While credit cards have many benefits when properly used, they can have devastating consequences when not. Previous generations may have had credit cards, but it wasn't quite the same as the credit card of today. There actually was a time when you had to qualify to get a credit card. If your grandparents had a credit card, it's likely it came with a stringent spending limit. The previous generation wasn't able to easily run up credit card debt and, as a result, people weren't saddled with huge interest payments.
Mortgage: Your grandparents probably had a mortgage, but in all likelihood it was for a much more modest house. That was because your grandparents were limited in what they could qualify for. The loan company demanded a 20% down payment. You had to show that you had the means to pay off the loan, something that is not always the case today.
(NFLX) - Get Report It's important to use the knowledge and past experience of those who had to weather difficult times. Just remember that there are also quite a few new common budget expenses that you'll have to navigate.
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