Save Money with These 4 Tricks

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Money-saving stories are a dime-a-dozen. Everyone has read the articles full of obvious, clichéd ways to save money: "Bring lunch from home!" or "Make your own coffee instead of buying that Starbucks (NASDAQ: SBUX ) latte!"

Many see the common anecdotes of advice and shrug them off because, well, sometimes it's nice to go out for lunch and sometimes a Cinnamon Dolce Latte trumps Maxwell House brewed at home.

That said, here are some easy ways to save money - significant money in some cases - that even though anyone can do them, many are frequently ignored. Here are four ways to save money right now or in the future:

1. Mortgages Should be Refinanced

Mortgage rates are at an all-time-low. Although credit standards are higher than they were a few years ago, there is a lot of money out there waiting to be lent. It is surprising how flexible some banks can be. At the same time, credit unions can be a prime source of loans for those with decent, but, not perfect credit.

Those with lousy credit probably won't get a new mortgage, but for those with decent-to-good credit scores, it's worth taking a shot.

The other major barrier to refinancing mortgages has been low appraisals. A low appraisal means a low loan-to-value ration. In many cases that can stop a loan dead.

President Barack Obama actually came to the rescue here as many homeowners are eligible to refinance their loan through the Homeowner Affordable Refinance Program (HARP). These loans do not require an appraisal and they are relatively easy to qualify for if the applicant is current and has a good payment record on the existing mortgage.

The downside to a HARP loan, or to any refinance, is that it adds time to the length of loan. If, however, interest rates can be reduced from 6% (normal just a few years ago) to 3.75%, homeowners can save hundreds of dollars a month. Put some of that savings into making an extra payment a year, and the duration of the loan can be reduced.

2. Cable Companies No Longer Have a Monopoly on Premium Content

Nearly every person in America has some alternative to simply calling their local cable provider and signing up at whatever price they offer. Services like HULU and Netflix (NASDAQ: NFLX ) - which a mildly tech-savvy person can easily watch on their regular TV using a ROKU player or a similar device - have created compelling alternatives to standard cable packages.

If giving up cable isn't practical, cable companies know about alternatives. By simply calling up the company and threatening to cancel, many subscribers can get their bills reduced. Not all companies will make a deal, but many will offer you the same deal new subscribers get (which can be a big savings) and some are willing to throw in premiums like premium channels or DVR service.

To have the best chance of success, don't simply talk with the normal customer service associate. Instead, ask for the person who handles people who may cancel their subscriptions.

3. Consider Dumping PMI

Private Mortgage Insurance is forced upon homebuyers who lack 20% equity when they purchase a home. The insurance pays off the mortgage if something happens to buyer and they can't repay. That sounds great, but, PMI solely protects the bank holding the mortgage. There is no benefit to the homeowner.

The trick with getting rid of PMI is that the homeowner has to prove that she now holds at least 20% equity in the home and, then, once she does, she must ask her bank to remove it. Technically, the bank can say no, but most won't unless the payment history is poor.

If the bank to is not asked to remove the PMI, it won't, no matter how much equity is held. Countless people pay PMI through the life of their loan adding what can be hundreds of dollars a month in expenses.

The challenge, of course, comes in the appraisal. After the recent mortgage scandals and housing market crash appraisers are getting more cautious. Chances are, the appraisal, which is largely based on comparable sales in your area, will come in lower than it would have a few years ago. So, if it's close, it might be a waste of money to get an appraisal. But, if with the equity is there, getting rid of PMI is a no-brainer way to lower monthly expenses.

4 Self-Manage 401Ks

Too many people take no active role in managing their 401Ks.

If that's the case, there is money to be made in taking an active role in how 401K funds are managed. First, employees should contribute enough to fully receive any matching funds the company kicks in. After that, make sure to contribute the maximum amount allowed if it can be afforded.

Once that is done, work with a financial planner (companies frequently provide access to them) and make sure money is being allocated properly. A 25-year old with no kids will have different needs and goals than someone who is 45-years old with a kid in college. Make sure the money is working for you as hard as it possibly can be and the rewards will be reaped when it is time to retire.

(c) 2012 Benzinga does not provide investment advice. All rights reserved.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Stocks
Referenced Symbols: NFLX , SBUX

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