Archives for April 23, 2019

In late 2018, ConsumerAffairs heralded that two major changes in how credit scores will be determined were on their way.

That time has come. Both Experian and the Fair Isaac Corporation (FICO) have tacked on new metrics in hopes of improving how it evaluates the overall creditworthiness of borrowers. With the aim of gaining a clearer picture of how risk is defined, those additional metrics will include a wide variety of nuances from cable TV and utility bills to checking and savings accounts.

Experian Boost

First out of the gate is Experian Boost, a product the company calls a “game-changing move.” With Boost, a consumer’s applaudable payment history is dovetailed into their Experian credit file which, in turn, should “instantly increase their FICO Score.”

“Experian Boost allows consumers — for the first time — to add positive payment information to their credit reports and potentially increase their credit scores instantly,” Jeff Softley, president of Experian Consumer Services, told ConsumerAffairs. “This gives consumers a level of control they’ve never had, which may help them get better credit products and better terms for those products.”

In an effort to make sure there were no unexpected potholes in Boost, Experian tested the platform with thousands of credit-active consumers. Here are some of the highlights from the Initial results:

Two-thirds of consumers saw an instant improvement to their FICO Score.

Depending on credit tier, 10 -15 percent of consumers moved into a better score category.

The average FICO Score increase was more than 10 points.

Consumer credit watchers also give Boost a thumbs-up. Elite Personal Finance writes that Boost should help 100 million people who previously didn’t qualify for mainstream credit, in addition to the 10 percent of all consumers who previously didn’t have a credit score.

UltraFICO Score

In a separate move, Experian — along with financial data aggregator Finicity and FICO — have joined forces to create UltraFICO Score, a reporting system where the consumer grants permission to contribute information from a variety of sources including bank checking and savings statements. What UltraFICO will be taking a hard look at is the length of time a consumer’s bank accounts have been open, frequency of activity, and evidence of saving.

Even though UltraFICO is still in the testing phase, consumer credit critics are giving it a thumbs-up.

In Elite Personal Finance’s opinion, UltraFICO should tell a more comprehensive story about consumers’ financial behavior. It benefits both the consumer who has little to no credit history, as well as the consumer who is trying to rebound from a spate of bad financial luck while trying to rebuild their credit scores.

Naturally, encouraging words like that are exactly what FICO was hoping for.

“This changes the whole dynamic of the lender and customer relationship,” said Jim Wehmann, executive vice president, Scores, at FICO. “It empowers consumers to have greater control over the information that is being used in making credit risk decisions. It also enables a deeper dialogue between the consumer and lenders to help both parties make better financial decisions.”

How can consumers improve their credit profile via UltraFICO when it becomes available? Simple. Maintain an average savings account balance of $400 without any negative balances over a three month period. Any consumer who can check that box should see an uptick in their credit score by as much as 20 points.

This is good, right?

Despite the best-laid plans of UltraFICO, one consumer credit observer is waving the caution flag.

“Some [are concerned that] taking banking information into consideration could hurt those who otherwise have a good borrowing and paying history but have poor banking habits,” writes Elisa Ortiz at Lexington Law, a provider of credit repair services. “However, with the new UltraFICO credit score, things are poised to change.”

Ortiz’ main concerns about UltraFICO include:

It could ruin the credit score for others: while the new metrics could make it easier for people with thin credit histories and good banking habits to get good credit scores, it could very well do the opposite for those who have a good credit history but poor banking discipline.

It could open up lending avenues for people who are a credit risk: the country is still reeling from the meltdown caused by subprime loans in 2008. Open credit avenues for people who could not afford to pay them back was one of the main factors that caused that financial disaster because it put a large strain on lending companies.

Ortiz also sees a loophole that UltraFICO’s scoring system. She says the system may allow consumers who are less deserving or consumers that might otherwise be tagged as a high credit risk to obtain loans they may not be able to repay. If that happens, there could create a whole new cycle of financial disasters like an unforeseen identity theft risk.

“There is no doubt that big organizations that hold very sensitive information can face hacking attempts,” Ortiz said. “Now imagine if hackers got hold of all your banking information from the Finicity servers as well as your credit information from Experian? It sounds far-fetched, but this is something that could happen and create a whole slew of identity theft problems for the American people.”

How to sign up for the new reports

Signing up for Experian Boost is free, but a quick heads-up — signing up also triggers an upsell for Experian CreditWorks Premium. With Premium, consumers can gain access to all three FICO Scores and credit reports for $1, but that $1 subscription only lasts seven days. After that, the service is $24.99 each additional month, but consumers may cancel anytime.

To start the ball rolling for Experian Boost, all consumers need to do is go to Experian’s special Boost website and grant permission for Boost to connect to their online bank accounts to identify utility and telecommunications payments. Once that’s taken care of and the consumer gives the OK to add Boost to their Experian credit file, an updated FICO Score will be delivered in real-time.

In ConsumerAffairs’ test of the Boost sign-up process, it took 15 minutes to get all the way through, including a call to Experian’s Boost support team after the last confirmation screen was in a seemingly endless loop.

As far as UltraFICO is concerned, the product has not yet been released to the masses. To sign up and be included when it’s rolled out, all a consumer needs to do is go to the UltraFICO site.

There are millions of reasons to be frugal.

“Ocean’s 8” and “Crazy Rich Asians” star Nora Lum — you may know the rapper and actress by her stage name, Awkwafina — seems to know this well. Though she’s worth millions, she recently admitted to many frugal habits. Earlier this month on the “Death, Sex & Money” podcast, she noted that she didn’t splurge on “literally anything” and that she was wearing pants from Target.

Plenty of other uber-rich people also pinch pennies. Probably the most famous among them is investor Warren Buffett, who eats breakfast at McDonald’s MCD, -0.51% Each morning, he asks his wife to set out $2.61, $2.95 or $3.17, which determines which breakfast he gets. “When I’m not feeling quite so prosperous, I might go with the $2.61, which is two sausage patties, and then I put them together and pour myself a Coke,” he says in the 2017 documentary “Becoming Warren Buffett.” He also still lives in the five-bedroom home he bought for just over $30,000 in 1958 in Omaha.

Lots of rich people are frugal, experts say. “Rich people don’t get rich by spending it all,” says Pam Danziger, a researcher focused on the affluent market and founder of Unity Marketing, which helps brands better connect with affluent consumers. “They know better than anyone that by being careful shoppers they can achieve a lifestyle several rungs up the income ladder.”

There are myriad reasons that many affluent people are, well, cheap. Some of them are self-made and spent years before they were rich being thrifty. “Thriftiness is habit-forming,” says Scott Tucker, the president and founder of financial firm Scott Tucker Solutions in Chicago.

Others fear that their wealth isn’t permanent, so they don’t spend a lot of their money. This is particularly true of the top 10% of the income spectrum, according to the 2015 Survey of Affluence and Wealth by research and polling firm YouGov. “The resourcefulness, financial independence and spending constraints that arose from the fear of the recession are now enduring attitudes of family financial management,” the authors wrote.

During the 2007-2009 recession, fear drove many Americans to “step up their savings, cut spending, and retool their household budgets, and to become more resourceful and independent when evaluating and making significant purchases. Over time, panic has given way to confidently applying these practices to their purchasing habits.”

Of course, rich people spend plenty, dropping $234 billion a year on luxury goods and services, Business Insider notes. Still, many of them are very thrifty. Here are five things that show that:

You’ll find them in the aisles of Target and Walmart…

Beyonce is crazy in love — with Target TGT, -1.49% Earlier this year, the star was reportedly spotted at a Target in Los Angeles. And seeing as how the singer is worth an estimated $355 million, according to Forbes, the internet responded with shock. Model Chrissy Teigen, for example, joked that the music star need not go to the big-box store, as she could send Beyonce her line of Cravings cookware for free.

But she’s far from the only wealthy person who shops at big box stores like this: One in three people with a net worth of more than $5 million says they shop at Walmart WMT, -0.79% , according to a survey of 1,200 ultra-high-net-worth investors released by financial information site Millionaire Corner. What’s more, nearly half say they shop at Costco COST, -0.97% and more than four in 10 at Target.

Indeed, when actress Busy Phillips saw that Beyonce had reportedly shopped at Target, she said she couldn’t believe it was on a day she wasn’t there.

…and dropping coin at the dollar store

Many dollar store shoppers make $100,000 a year or more, data released by research firm NPD Group found. “Considering that nearly one in five dollars spent there is contributed by the affluent, dollar stores’ value proposition clearly resonates across economic segments,” says Andy Mantis, executive vice president of Checkout Tracking, a division of NPD. The average wealthy dollar store shopper makes about one trip a month to those stores, the data showed (though, to be fair, lower income people do make more frequent trips).

They tool around town in a Ford

Just because you’re a football star, doesn’t mean you spend like one: Indeed, as The Wall Street Journal reported, a number of pro athletes scrimp on their wheels; — the story mentions that quarterback Kirk Cousins drives a GMC Savanna passenger van.

And data released in August 2016 by car site Edmunds.com found that the most popular car among people with incomes above $250,000 a year was the Ford F-Series F, -0.52% , followed by the Jeep Grand Cherokee and the Jeep Wranger; the Lexus RX and BMW X5 were only the No. 4 and No. 5 on the list.

“There will always be an interest in and market for high-end exotic vehicles,” says Edmunds.com executive director of industry analysis Jessica Caldwell. “But, overall, most of the wealthiest Americans look for their vehicles to perform the same kind of functional tasks that everyone else does.”

Other studies show a similar penchant for modest cars among the wealthy: Among the top 10 most popular vehicles in America’s wealthiest neighborhoods, half are non-luxury vehicles, an analysis of car-buying habits of residents of the 10 wealthiest zip codes in America by TrueCar.com found. These include the Honda Accord, Toyota Camry, Honda CR-V, Volkswagen Jetta and Toyota Prius

They clip a lot of coupons

Millionaire actress Kristen Bell says she’s an avid couponer. Her favorite: the Bed Bath and Beyond Coupon. And she’s not the only rich person to do so. People making over $100,000 were actually more likely than those making less to use coupons, a survey of more than 8,000 shoppers by deal site Deals.com found.

What’s more, one in four people who often use six or more coupons during each shopping trip reported incomes of $75,000 or more, according to research by the University of Arizona’s John Davis Norton School of Family and Consumer Sciences. They’re known as “coupon divas” by the researchers. “They don’t use coupons because of financial constraints but because they perceive coupons as saving them money,” said Anita Bhappu, an associate professor at the University of Arizona.

They give a lower percentage of their income to charity

“The rich aren’t the most generous,” concludes a 2012 study published in the Chronicle of Philanthropy. “Middle-class Amer­i­cans give a far bigger share of their discretionary income to charities than the rich.” The data, which looked at IRS records, found that while households earning $50,000 to $75,000 give an average of 7.6% of their discretionary income to charity, households making $100,000 or more give an average of 4.2%.

Turn on your tap to help stop pouring on the pounds.

Kids, teens and young adults who don’t drink water end up guzzling almost 100 extra calories a day from sugary beverages, on average, according to a new study in JAMA Pediatrics.

About one-fifth of the 8,400 subjects ages 2 to 19 in the nationally representative survey reported no water intake on a given day. And after accounting for sociodemographic factors, the researchers found that skipping water (defined as being water that was unsweetened and noncarbonated) was associated with consuming an extra 93 calories and 4.5% more calories from sweetened drinks (such as sodas, juices and sports drinks) than those who had at least one serving of water (defined as anything more than zero milliliters).

“What was kind of surprising was that one in five kids and teens didn’t consume any water at all, and those kids were consuming twice as many calories from sugar-sweetened beverages than those kids who did drink water on any given day,” study author Dr. Asher Y. Rosinger, director of the water health and nutrition lab at Penn State University, told MarketWatch.

While the study reported that metrics such as sex or federal income-to-poverty ratio did not have a statistically significant impact on how many calories these youths consumed when they didn’t drink H2O, their race/ethnic group did appear to have an affect. For example, white, non-Hispanic children who didn’t sip any water consumed an extra 122 calories from sugary beverages — twice as many as the Hispanic children in this study who took in an extra 61 calories. And black, non-Hispanic youths who didn’t drink water fell in the middle, consuming an extra 93 calories in sugar sweetened beverages.

The study admits that its data doesn’t prove causality, as the kids and young adults were not asked their reasons for consuming more sugary drinks, or why they didn’t drink water. But it still recommends that children, adolescents and young adults drink water daily to help avoid consuming extra calories from sugar. In fact, a 2016 American Heart Association report even recommended that parents limit their children ages 2 to 18 to just eight ounces of sugar-sweetened drinks over seven days, or less than 25 grams or six teaspoons of added sugars daily — in other words, less than one can of soda a week. The AHA warned that children who drink sugary drinks are at greater risk of obesity, heart disease and type 2 diabetes.

So this new research suggests that if dumping your favorite sweetened soda or sports drink is challenging, then quenching your thirst more frequently with water may be easier to swallow.

Plus, a 2010 study found that people who drank two glasses of water before each meal ate between 75 and 90 fewer calories per meal, and they lost an average of five pounds more weight over three months than those who didn’t drink any water. Drinking water before meals also decreases feelings of hunger and increases your feeling of fullness afterward.

President Donald Trump and his business filed suit against Democratic House Oversight Committee Chairman Elijah Cummings on Monday to block a subpoena sent last week seeking information about the president’s finances.

In the complaint filed in Washington, D.C., federal court Monday morning, Trump’s lawyers said that Democrats have “declared all-out political war” against him.

“Subpoenas are their weapon of choice,” the filing states.

Last week, the House Oversight and Government Reform Committee subpoenaed Mazars, an accounting firm that Trump had used to prepare several years of financial statements, according to the lawmakers’ document.

The subpoena requested a slew of financial documents and related materials from Trump, his trust, the Trump Organization, the Trump Corporation, Trump’s holdings company, the Trump Foundation and the Trump International Hotel in Washington. Mazars told the committee that it would not be able to comply with demands for those documents without a subpoena, according to Cummings.

In a statement, Cummings said that Trump has a “long history of trying to use baseless lawsuits to attack his adversaries, but there is simply no valid legal basis to interfere with this duly authorized subpoena from Congress.”

Cummings added: “This complaint reads more like political talking points than a reasoned legal brief, and it contains a litany of inaccurate information. The White House is engaged in unprecedented stonewalling on all fronts, and they have refused to produce a single document or witness to the Oversight Committee during this entire year.”

Mazars and Peter Kenny, the Oversight Committee’s chief investigative counsel, are also listed as defendants in the lawsuit.

Trump’s lawyer in the lawsuit, William Consovoy, said in a statement that the attempt by Cummings’ committee to “obtain years’ worth of confidential information from their accountants lacks any legitimate legislative purpose, is an abuse of power, and is just another example of overreach by the president’s political opponents.”

The president’s counsel, Jay Sekulow, told NBC News: “We will not allow Congressional Presidential harassment to go unanswered.”

The White House did not immediately provide a statement to CNBC regarding the lawsuit.

Trump’s lawyers argue that Cummings’ subpoena lacks a “legitimate legislative purpose,” and is therefore an invalid action for a congressional committee to take.

“With this subpoena, the Oversight Committee is instead assuming the powers of the Department of Justice,” the complaint says.

“Its goal is to expose plaintiffs’ private financial information for the sake of exposure, with the hope that it will turn up something that Democrats can use as a political tool against the president now and in the 2020 election.”

The filing goes on to attack the credibility of the subpoena by connecting it to testimony given in February by Trump’s former longtime personal attorney, Michael Cohen.

Cohen’s damning testimony before the House Oversight Committee on Feb. 27 — in which Trump’s former fixer called his ex-boss a “racist,” a “cheat” and a “con man” — offered “one of the worst examples of the House Democrats’ zeal to attack President Trump under the guise of investigations,” Trump’s lawyers said.

Cohen, who had previously pleaded guilty to lying to Congress about since-aborted plans to build a Trump Tower building in Moscow, is set to report to federal prison May 6.

Cohen’s attorney Lanny Davis, who is also mentioned in Trump’s Monday morning court filing as “a political operative for the Democrat party,” said in a statement to CNBC: “We trust that the courts will deal with all issues fairly on the merits. We won’t dignify the personal accusations in the filings except to say that frivolous things said by frivolous people don’t deserve a serious response.”

Davis continued: “The reasons for Mr. Trump’s desperate attempt to prevent his tax returns from being made public — like all prior presidents — is no mystery. Does anyone doubt he has something to hide?”

Democrats have called on Trump to disclose a variety of financial documents since the 2016 election — especially his tax returns, which presidential candidates have traditionally released voluntarily but which Trump refused to share.

House Ways and Means Committee Chairman Richard Neal, D-Mass., formally requested that the Internal Revenue Service hand over years of Trump’s returns. Earlier this month, Neal set a Tuesday deadline for IRS Commissioner Charles Rettig to deliver six years of Trump’s personal and business tax returns.

Meanwhile, federal prosecutors in New York are digging into the Trump campaign’s finances — an investigation stemming at least in part from Cohen’s admission that he committed campaign finance violations by facilitating hush-money payments to two women during the 2016 election who claimed they had affairs with Trump years earlier.

Trump has denied having sex with either woman and also has denied directing Cohen to pay them. Cohen, however, says Trump directed him to make the payments.

Retirement is supposed to be an enjoyable period of life, but if you don’t plan for it properly, the opposite might end up holding true. Here are four mistakes that could derail your retirement and leave you cash-strapped and miserable at the same time.

1. Relying on Social Security alone

Though Social Security helps millions of seniors stay afloat financially, those benefits aren’t designed to sustain retirees by themselves. If you’re an average earner, you can generally expect Social Security to replace about 40% of your previous income in retirement. Most seniors, however, need roughly double that amount to live comfortably, which means that if you don’t save on your own for your golden years, you’re likely to come up short.

Remember, though certain expenses, like commuting costs, might go away in retirement, most of your monthly bills will likely stay the same. Some might even go up. Take leisure, for instance. Once you have more free time on your hands, you might start spending more to keep yourself occupied. Similarly, if you’re home a lot during the day since you no longer have an office to go to, you might spend more to heat and cool your living space. Be sure to amass some personal savings before kicking off your retirement, because relying on Social Security alone will leave you scrambling to make ends meet.

2. Underestimating your healthcare costs

Many seniors know that healthcare is a major expense they’ll need to grapple with in retirement, but a large number fail to realize just how costly medical care can be. Investment giant Fidelity recently shared projections that put the cost of healthcare in retirement at $285,000 for a 65-year-old couple retiring this year.

Of course, your healthcare tab will depend on numerous factors, such as whether you enroll in traditional Medicare versus Medicare Advantage, whether you buy supplemental insurance, and what your actual health looks like. But know this: Fidelity’s projections are just one of many estimates out there. HealthView Services, a cost projection software provider, reports that healthcare in retirement will actually cost the average healthy 65-year-old couple today more like $364,000. Therefore, keep tracking the cost of medical care, but just as importantly, ramp up your savings so that you ultimately have the money to pay for it.

3. Forgetting about taxes

Many people assume that seniors mostly get out of paying taxes, but that’s far from true. There are a number of ways the IRS might come after your income in retirement. First, if you house your savings in a traditional IRA or 401(k), your withdrawals in retirement will be taxed as ordinary income. The only way to get around this is to save in a Roth IRA or 401(k) instead.

Additionally, your Social Security benefits might get taxed at the federal level if they only make up a portion of your total retirement income. And if you live in a state that taxes Social Security, you’ll lose some more money at the state level as well.

Income you collect from a pension is also subject to taxes most of the time (though there are some exceptions to this rule). And if you earn investment income or interest in a nontax-advantaged account (such as a traditional brokerage or savings account), you’ll pay taxes on that, too. The point, therefore, is to plan on forking over some money to the IRS year after year. If you anticipate being taxed in retirement, you can budget around it.

4. Not planning for long-term care

Many seniors get injured or experience a decrease in mobility as they age. So, many find that they can no longer manage to live on their own without some sort of help. In fact, an estimated 70% of seniors 65 and older wind up needing long-term care, whether in the form of a home health aide, an assisted living facility, or a nursing home. And if you don’t buy insurance to help cover the costs involved, you could be in for quite a financial shock.

The average assisted-living facility in the country costs $48,000 a year, according to Genworth Financial’s 2018 Cost of Care Survey. Nursing home care is even more expensive — $89,297 a year, on average, for a shared room, and $100,375 a year, on average, for a private one.

That’s why you really need long-term care insurance going into retirement. The best age to apply is in your mid-to-late 50s, because at that point, you’re more likely to snag a discount on your premiums based on your health and age. That said, many seniors apply for policies in their 60s, and if your health is decent, it certainly pays to do so. Otherwise, an extended period of care could effectively wipe out your retirement savings, leaving you broke and vulnerable later in life.

Retirement can be a scary prospect from a financial perspective, but it doesn’t have to be. Steer clear of these mistakes, and you’ll avoid much of the stress so many of today’s seniors face.

Only 64% of workers in America have anything saved for retirement, according to the 2018 Retirement Confidence Survey — and a whopping 47% have less than $25,000 saved, per the prior year’s survey. Clearly, most of us have a lot more saving to do to avoid spending our last decades stressed out making ends meet.

Saving enough for retirement is easier said than done. There are always many demands on our limited funds. So, here are seven ways you could start saving more money. See how many you can put into practice.

Trick No. 1: Get — and stay — out of debt

It’s hard to save much money if you’re deep in debt, spending thousands of dollars annually on interest. Some debt, such as low-interest rate mortgage debt, isn’t so problematic, but high-interest rate debt, such as that from credit cards, can be ruinous to your financial health.

Imagine that you owe $25,000 on your credit cards, as plenty of people do. If you’re being charged 20% interest, a typical rate, you’ll be forking over $5,000 annually for nothing! Socking away $5,000 annually in a retirement account that averages 8% annual growth would amount to almost a quarter of a million dollars over 20 years — that’s what you’re forfeiting if you’re mired in debt with no plans to dig yourself out. Getting out of debt isn’t always easy, but it can be done, it’s very satisfying to do, and it will give your financial health a powerful boost.

Trick No. 2: Automate your savings

This strategy is fairly easy. Your employer may let you have a set amount transferred directly from your paycheck each pay period to a certain bank account or two. You might, for example, have $400 sent to a savings account every pay period, thereby saving roughly $10,000 each year.

Taking advantage of automation with a workplace 401(k) account is also effective. Preset sums will be automatically transferred from your paycheck into your retirement savings account. Many companies automatically enroll you in their 401(k) program, but set your contribution percentage rather low. Increase your contribution so it’s a meaningful percentage, between 10% and 15% at the least, and then aim to increase the percentage annually. (Don’t assume that 10% is sufficient. For many people, it isn’t — especially their savings are below what they should be.) If your employer offers a match, this strategy will pay off even more.

Be sure to invest that money effectively, too, remembering that long-term dollars are likely to grow fastest in stocks. Consider a low-cost, broad-market index fund such as the SPDR S&P 500 ETF (SPY), Vanguard Total Stock Market ETF (VTI), or Vanguard Total World Stock ETF (VT).

Trick No. 3: Sock away part of all your raises and tax refunds

It’s delightful to receive regular raises at work and to get a tax refund check every year from Uncle Sam, but don’t waste that money on treats or park it in your bank account, where it can be accidentally spent. Instead, direct those funds straight into your retirement savings.

You may not be able to save every raise for decades, but aim to save as many extra funds as possible. You’ll be living below your means and growing financially healthier.

Trick No. 4: Get — and stay — healthy

This trick may not seem that related to finances, but it is: Getting healthy, and staying healthy, means you’ll probably spend less on healthcare in your life. That can amount to a lot of dollars.PauseCurrent Time0:00/Duration Time0:00Stream TypeLIVELoaded: 0%Progress: 0%0:00Fullscreen00:00Mute

A 65-year-old couple retiring in 2019 will spend, on average, a total of $285,000 out of pocket on healthcare, according to Fidelity. There are no guarantees, but you will be more likely to spend less on healthcare if you take care of yourself.

Trick No. 5: Take on a side gig

That’s right — get another job. It may not sound appealing, but it doesn’t have to be terrible. Think about what kinds of things you are good at and what kinds of activities you enjoy. You might make some extra money by driving for a ride-sharing company on some evenings or the weekend, or you might pick up some extra dollars by tutoring, editing, coaching, consulting, walking or boarding pets, gardening, organizing, cooking, catering, or renting out a room in your house via Airbnb.

A good side gig can net you an extra $1,000 or more per month. Even if you just work as a cashier earning $10 per hour for 10 hours per week, that’s an extra $5,000 or so per year you can save in your retirement accounts to grow for you.

Trick No. 6: Use rewarding credit cards

If you’re a regular credit card user, be sure you’re using the kind of card that serves you best. If you’re still paying off debt, focus on balance transfer cards or low-interest rate cards. But if you’re financially healthy, favor cards that offer rewards and/or cash back.

There are cards that offer anywhere from 1% to 2% back on every purchase, and some that pay up to 5% or 6% back on certain purchases, such as those at supermarkets or certain retailers. If you spend $500 per month at Amazon.com and its subsidiary Whole Foods Market, you can earn 5% back on most purchases there, which saves $250 annually. If you travel a lot, your best bet might be a card that offers travel rewards and discounts.

Don’t use this tip if you’re struggling with credit card debt or are not disciplined enough to only charge what you can afford on credit cards. If you’re in debt, focus on paying off your debt, perhaps with the help of a 0% intro APR card or a balance-transfer card.

Trick No. 7: Make money-saving phone calls

If you spend just an hour or two making phone calls to insurance companies every year or so, you might end up saving hundreds of dollars per year on your home insurance, car insurance, umbrella insurance, renters insurance — even your health insurance. Each insurer uses different formulas to determine their rates, and at any given time, each offers you a different price for the same coverage. Remember, too, that you can often save more by having two or more policies with the same insurance company.

If you’re saddled with high-interest rate credit card debt, call your credit card companies and ask for a lower rate. If you’ve been a loyal customer, you may well get some relief — just for asking. Give your cable TV company a call every now and then, too, to see if there’s any new promotion that can reduce your monthly bill. There may well be one, especially if you let them know you’re considering other providers.

Acting on a few — or all — of these money-saving strategies can help supercharge your retirement savings and beef up your financial security. Many of them are relatively painless, too.