Save BIG: Saving the Most Where You Spend the Most

Oct. 19, 2009 — -- I have BIG news! I just finished writing a book called "SAVE BIG." The publisher is Wiley and it comes out Jan. 1. I spent the weekend poring over the final page proofs looking for typos. What a job. Anyway, I'm exhausted -- but excited -- by the project and I want to tell you about the philosophy behind it because I think it's something that could really help people in this crummy economy.

Here's the premise. I'm tired of experts who harp on what I call Small Stuff Savings; giving up your daily latte, packing your own lunch, installing low-flow shower heads. Ugh. Give me a break.

Instead, my book tells you how to save tens of thousands of dollars on the BIG stuff. I have always preferred to save a lot of money on a few things rather than a little bit of money on a bunch of things.

If we can identify the areas where we spend the most money, that's where we can save the most money. And we can. Here they are:

Houses.
Cars.
Credit.
Groceries.
Health care.

Did you know those are the top five expenses for U.S. families? Houses and cars, sure. But credit? Most people don't think of it as an expense but it's a whopper.

Groceries are little things, but they add up to big money because we need them to survive.

And health care, whew, I hate to even bring that topic up right now, but let's just say my savings advice on health care will stand regardless of what Congress does or doesn't do.

Here are some examples of how, and how much, you can save if you strive to SAVE BIG. These are real savings achieved by real people:

HOUSE:
• Fight junk closing costs when you buy a home and save $2,530.
• Refinance into a shorter mortgage. Save $103,536.
• Appeal your property taxes and save $1,265 a year.

CAR:
• Buy a "dark horse" car instead of the most popular make and model and save $ 6,814.
• Pay cash for your car instead of taking out a loan and save $2,608.
• Exercise a "secret warranty" where the dealer fixes flaws for free and save $1,400.

CREDIT:

• Ferociously guard your credit score and save $87,480 over the life of your mortgage.

• Undergo rapid rescoring to correct errors on your credit report before finalizing a mortgage and save $72,000 over the life of the loan.

• Negotiate for a lower credit card interest rate and save $1,272 on a $15,000 balance.

• Price match using simple online tools and save $4,628 a year on groceries.

• Stockpile groceries when they're on sale rather than buying them as you need them and save $5,772 a year.

• Master creative couponing (Click don't clip!) and save $7,956 a year!

HEALTH CARE:
• Raise your health insurance deductible and save $2,700 a year.
• Take the generic version of a drug instead of the name brand pill and save $6,350/year.
• Hire a medical billing advocate to fight hospital billing errors and save $6,858.

Yes! That's what I mean when I say SAVE BIG! In fact, I guarantee that every tip in my book has the potential to save you at least $1,000. Smaller savings ideas didn't make the cut. Are you beginning to see the potential?

My suggestions will also save you big TIME because they're not tedious savings strategies you have to pursue every day. You just focus for a little while when these events come up in your financial life, then you can relax.

In the coming weeks and months, I hope to start a dialogue about the merits of SAVING BIG rather than wasting time on Small Stuff Savings. My grand plan is to use you -- the regular readers of this column -- as my focus group.

Are you game? I'll share my thoughts and ideas for saving the kind of money that can make a real difference in your life. All I ask is that you share with me in return.

How have you SAVED BIG in your life? Remember, the savings must be at least a $1,000! I'll publish the best ideas in this column so that, maybe, your savings strategy can save somebody else. That would be BIG of you.