Savings Makeover: Cut Your Costs by Thousands with Painless Financial Tweaks

When McGraw Hill Federal Credit Union's underwriters looked at the Shoblock's finances, they could see that they had accrued some debt, but also that they always paid their bills on time and never missed a payment, despite their troubles. So the credit union approved them for a new mortgage -- the hardest kind of loan to get!

"We approved you to refinance the balance into a 10/1 adjustable rate mortgage at a rate of 4.75 percent, zero discount points, no origination fees," Lipari told the Shoblocks. "Are you kidding me," Gary asked. "Is this candid camera?" In a 10/1 ARM, the first number, in this case "10" means the loan will be fixed for ten years and the second number, "1" means it will adjust every one year after that.

Adjustable rate mortgages got a bad rap during the bubble years, because so many people signed up for them not realizing that if their rate adjusted upward they would no longer be able to afford the monthly payments. But the initial interest rate on an ARM is lower than that of a fixed rate mortgage, so you can save big money if you know you are going to sell before your ARM adjusts. The Shoblocks plan to downsize into a smaller home once all the kids go to college. That will probably be in the next three to four years, but this loan gives them some cushion -- 10 years at a fixed interest rate before it adjusts. The new mortgage will save them a welcome $429 a month, loosening their tight purse strings. Better yet, it will save them $55,203 over the next 10 years. "I'm speechless," Robin said. "It's just so hard to come up with ways to thank you guys for your help."

WEB EXTRA TIPS

Here are three more savings strategies I found for the Shoblocks that we didn't get to on GMA –and that might work for you.

Strategy #9: Switch cellular providers = $1,168

As a family of seven -- with three teenagers -- let's just say the Shoblocks use a lot of cellular services. They were getting a pretty good deal on wireless because Gary got a discount through his employer. So I wasn't able to find them any great savings by switching to a different plan at their existing provider. But the Shoblock's contract was set to expire in a couple of months. So I had the innovative website FixMyCellBill.com look at other carriers for them. FixMyCellBill.com, also known as MyValidas.com, is a website where you upload your cell phone bill and special software analyzes thousands of providers and plan variables that our human brains just can't process. The website determined that the Shoblocks could get the exact same features they enjoy now, but save $1,168 a year by switching carriers. "It's a real relief," Robin said. "I always walk around saying 'I hate the cell phone bill…I think everyone would be a lot happier."

BONUS: Right now, GMA viewers who want to try the FixMyCellBill service can get 20 percent off by entering the promo code "SAVE BIG."

Strategy #10: Do volunteer work for student loan money = $4,725

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