How & where to cut costs for Young Adults, Part 1
Easy to follow & use money tips that will serve you well long term! 
With this recession, we see many articles on how hard families are hit and how they get into massive debt trying to retain the same lifestyle. There are also many articles trying to help these families find ways to cut costs, but there’s nothing for the teen or young adult. In difficult financial times, everyone is affected. Only the luckiest can continue as nothing happened. As a young adult, our most expensive items are probably car payments, insurance, cell phones, music, and rent. Other items, such as gas and electricity, we can’t do much except shop around for the best rates. I’d like to offer a few things you may be able to do to reduce your costs.
If you have a car that is not paid off, consider refinancing the loan. Most people buy the car from the dealership, finance it there, and just continue paying with the dealership’s high interest rate. I understand that, in most cases, the car must be originally financed through the dealer to get cash back offers, but you can refinance after a specified time period (normally two months, look at your paperwork for the exact time). I did exactly this. My new car had to be financed for one month through the dealer; and with a 9% interest rate, payments were approximately $295/month. After that month was up, I refinanced through my credit union and got a 3.9% interest rate with payments of $260/month. $35 a month is a considerable difference! You save over 400 a year for the five years. That’s an extra $2,000 for savings! There’s only one catch with refinancing, but it can also be a blessing. You will restart your loan years. If you’ve been paying on your loan for 2 years, when you refinance, you will have another 5 years of payments. The blessing is that your loan will be for much less money and will reduce your required loan payments significantly. For example, if your original loan was for 10,000 and you had an interest rate of 9%, your payment is $208/month. After you’ve been paying for 2 years, you have $6,500 left on the loan. Refinancing at this point with a 4% rate gives you a payment of only $120/month, saving you $90/month! This can very effective if you have contract work where your income is variable. You can always pay more on the loan than the minimum, but if a time comes around where you are earning very little money, the minimum payment is very easy to handle.
I will tackle the other items mentioned above on how to cut costs next time.
I used the calculators available at MSGCU, Michigan Schools and Government Credit Union. You can use these for your own loan payments or find your personal credit union’s/bank’s calculators.