Email | Print    Type Size  -  +

4 Tips for Saving Money

Mint founder Aaron Patzer's advice on managing money in the downturn.

Jessica Shambora, reporter
Last Updated: March 2, 2009: 1:22 PM ET

NEW YORK (Fortune) -- For founder Aaron Patzer, personal finance should be "easy and effortless." Following are a few tips from Patzer on saving and spending. (Read more about how he started here.)

Don't budget (everything)

You probably don't need to budget every last expense in order to start saving. Instead, focus just on two to three problem areas: shopping, restaurants, buying too many DVDs, etc. Use an online tool to categorize your incoming transactions, and get the site to email you when you're approaching your budget limit.

Get cash back on your purchases

Credit card networks like Visa or Mastercard charge retailers for each purchase they help facilitate. As a consumer, you can get a cut of those fees in the form of cash-back rewards. Opt for cash over miles or points -- cash is more flexible. Don't settle for a card that pays less than 1%. For a typical household, that can mean as much as $300/year back, just for doing what you were going to do anyway.

Understand Your Credit Score

Financial institutions use your credit score (also known as a FICO score) as an indication of how "risky" you are. This in turn determines 1) whether or not they will give you credit or a loan, and 2) how much interest to charge you. Improving your credit score -- especially if you are thinking about buying a house or taking out a large loan -- can be worth literally tens of thousands of dollars. Check your credit score at least twice a year.

Try an Internet-only bank

The average American savings account currently pays about 0.50% interest. That's a shame, because banks turn around and loan money to borrowers at interest rates up to 8%. Despite falling interest rates, you can still earn up to 3.0% with online only banks.  To top of page

Company Price Change % Change
Western Union Co 15.25 -0.80 -4.98%
Regions Financial Co... 10.22 -0.12 -1.16%
Twenty-First Century... 32.52 0.87 2.75%
Oracle Corp 40.08 -0.05 -0.12%
Merck & Co Inc 56.47 0.21 0.37%
Data as of Apr 17
Index Last Change % Change
Dow 16,408.54 -16.31 -0.10%
Nasdaq 4,095.52 9.29 0.23%
S&P 500 1,864.85 2.54 0.14%
Treasuries 2.70 -0.02 -0.62%
Data as of 9:28am ET
More Galleries
10 things I learned at the New York auto show Auto shows these days are about as relevant as a dashboard cigarette lighter. But a careful observer can still pick up a thing or two. More
Rebirth of America's dead factories Defunct factories around the country are in high demand as U.S. production once again revs up. More
50 years of the Ford Mustang Take a drive down memory lane with our favorite photos of the car through the years. More
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.