Three Money Tweaks

By Dayana Yochim, Co-Advisor
Adapted from:  Motley Fool GreenLight

They say it's the little things that count. When it comes to your money, you can Super Size that.

Even the smallest tweaks to your finances can noticeably fatten your wallet. Can you sock away an extra percentage or three of your dough this year? Excellent, you just made $700 smackaroos. Can you give up your credit cards for just a few weeks and spend only cash? Fabulous, you've cut your expenses by 60%.

Improving your financial status needn't require clipping coupons or finding part-time work for the kids. Just a few strategic tweaks is all it takes.

Here are three quick and easy money to-dos (none should take more than 20 minutes to set up) that could add up to $1,100 to your bottom line.

Put your plastic on ice: Studies show that people spend more -- and more carelessly -- when they whip out the credit cards. The reason?: When actual cash doesn't change hands, we devalue our dollars. (In fact, the average credit card transaction is 60% higher than the average debit/cash purchase.) Cashless and carefree, we stray from our shopping lists and succumb to impulsive purchases.

Nowhere is this more pronounced than in the market aisles. An estimated 59% of grocery store purchases are unplanned. (Did you really need another windshield de-fogging cloth?)

To do: Bring some respect back to your Benjamins: For one week, try sticking to an all-cash diet. The simple act of having to reach for your wallet and pull out actual dollar bills will likely curb your spending (shaving that $100 grocery bill down to $41, for example) -- and bring more cash consciousness to formerly mindless spending.

Money In the Bank: $59

Inject your cash with collagen: Is your savings still earning interest rates circa 2004? Then it's time to bring your bank account up-to-date. High-yield savings and checking accounts are an ideal place to park cash for day-to-day expenses. To woo your dollars, some banks -- particularly those whose operations are mainly online -- offer interest rates on par with short-term CDs.

Just take a look at two of the banking deals we researched for the next issue of GreenLight (where we'll also highlight the best high-yield money market accounts and CDs). Both of offer a low, low account minimum, which make them attractive holding spots if your balances tend to fluctuate. Both also offer impressive APYs (as of press time). There are a few accessibility tradeoffs, which are noted below:

Emigrant Bank (www.emigrant-direct.com): 5% APY. $1 account minimum. No restrictions on the number of withdrawals or deposits. Note: To access your dough, Emigrant links to another of your existing accounts. Therefore, there's a delay -- two to five days -- before your account is completely reconciled.

HSBC (www.hsbcdirect.com): 5.05% APY. $1 account minimum. Unlimited deposit. Unlimited withdrawals with HSBC debit card, or up to six withdrawals per calendar month. Note: Like Emigrant's offer, your HSBC account is linked to one of your existing accounts. You'll have to transfer funds to your existing account and use that bank's ATM to avoid fees.

To do: Gather your emergency cash cushion or next year's vacation dough and transfer it into a high-yield account. For someone who keeps $6,000 in savings, that's an extra $300 in interest over one year (at 5%).

Money In the Bank: $300

Inch up your savings: If you've ever monkeyed with a retirement savings calculator, chances are you've experienced the sensation of blood draining from your head. So daunting are the numbers that many people assume nothing short of an extreme money makeover will put their long-term savings on solid footing.

To do: Deep, cleansing breathes, everyone. Let's start with baby steps. Ask your human resources manager for your 401(k) (or other work-retirement plan) paperwork and increase your contribution by 3%.

That measly 3% is hardly pocket change. Consider that a single $1,500 investment (3% of a $50,000 salary) earning an 8% average annual return will be worth $2,200 in five years (that's $700 more in your pocket). If you stick to the 3% savings goal all five years (socking away a total of $7,500), you're looking at an extra $2,000 in nest egg padding.

Money In the Bank: $700 (at least!)