Eight Unusual Ways to Create Cash

If you've been reading this blog for any amount of time, you know that Principle 1 is to maximize income from all sources and Principle 2 is to minimize expenses.  But these are easier said than done.  After all, everyone would have more money if it was that easy to make more or spend less, right?

O.k., I'll give you that making more might be a bit tough, but it's also not impossible.  And spending less is relatively easy if you approach it with the right attitude and commitment.  In fact, here are eight ways you can create extra cash that you may not have considered -- some simple steps to help you uncover hundreds of dollars you probably already have!

Discover Antiques

PBS’ popular Antiques Roadshow has demonstrated that many people unknowingly have valuable antiques in their homes.  For instance, one woman discovered the “worthless” vase given by a friend was actually a rare piece worth $12,000.  Scour your closets, attic, and basement and take items you suspect are valuable to an expert for appraisal.

Or if you enjoy searching for treasure, hunt for antiques at garage sales, flea markets, and consignment stores.  An avid cookie jar collector, Tiana Brown of Jasper, Georgia recommends the following for new collectors: “Start off slow and small, and pick an area of antiques/collectibles that captures your fancy. Browse as many antique stores as possible to get an idea of where you would like to start, and what resale price range you can expect on your specialty.  Keeping in mind a small percentage for resale profit, set a limit of what you will bid for an item.”  For tips on how to find and buy antiques, check out the Antiques Roadshow section of www.pbs.org or read Buying and Selling Antiques: A Dealer Shows How to Get into the Business.  You may find something priceless!

Use Only Cash

It seems impossible to exclusively use cash in today’s credit-oriented world, but those who do “create” significant cash.  How? By spending dramatically less. Ron Blue, author of Master Your Money, notes that the mere use of credit cards causes a family to spend 34 percent more even if the statement is paid off monthly.  Author Nancy Dunnan agrees in Never Call Your Broker on Monday by noting, “People like your parents or grandparents actually went through life using checks or cash.  It worked then and it works now.  Do the same and you’ll wind up spending 20% to 45% less.”

So use cash and reap a windfall. Imagine how spending one-third less could impact your family finances!

Practice Self-Control

One of the greatest ways to save money is to avoid impulse buying.  Establish a rule that if you see something you want, you’ll wait at least two days before purchasing it.  If you still feel you need it, then buy it.  In most cases, the desire to have that item will be gone, and you'll have avoided an unnecessary purchase. 

Financial counselor Larry Burkett recommends a similar plan in Your Finances in Changing Times.  Larry comments he experienced dramatic results when he initiated a delayed purchase plan for tools (his weakness): “I continued that plan for over six months without purchasing a single item on my chart.  The reason was obvious: once I left the store, the impulse passed.”

Eliminate Debt

(yes, even Principle 3 is in this post)

Paying off a credit card charging 17% annual interest is equivalent to investing money with a before tax, guaranteed return of almost 20% -- a rate any investor would love. According to debtguru.com, the average amount of credit card debt in households with more than one card is now more than $8,000. That’s 167% more than the $3,000 average for households in 1990.  Eliminating this debt would save almost $1,400 per year!  If you need help getting out of debt, call the nonprofit National Foundation for Consumer Credit at 800-388-2227.

One way to lower debt easily is to refinance your mortgage.  By lowering your rate only 1 ½%, you’ll save over $64 a month over 15 years on a $75,000 mortgage (a total savings of almost $11,600!).  Many banks are so hungry for customers that they’ll forego the closing costs you’d normally pay.  (Your current bank may be willing to decrease your rate just to keep your business.)  But even if you pay these costs, it makes sense to refinance if you will own your house long enough to re-coup the expenses. 

Maintain Your Stuff

One way to create cash is to avoid major expenses.  Regularly maintaining the high-cost items you own can significantly increase their lives. This means servicing your car regularly, having the furnace and lawn mower cleaned seasonally, and vacuuming refrigerator coils monthly. Check owner’s manuals for maintenance specifics.  Maintaining your possessions can keep them running more efficiently and lasting longer saving thousands over the years on utilities, repair bills, and, of course, replacement costs.

Jodi Doyle (formerly) of St. Petersburg, Florida has reaped the benefits from this practice.  "My last refrigerator and washing machine each survived 20 years and a move to Europe because I took care of them regularly,” she comments with pride.  “It took some extra time and effort, but I even performed preventative maintenance.  And the appliances repaid me by lasting much longer than I expected.”

Get Money That’s Owed to You

Believe it or not, there are billions of unclaimed dollars in America.  They are held by federal and state governments as well as private companies in the form of pensions, bonds, taxes, real estate, and savings accounts.  These items have been forgotten, abandoned, or belong to unsuspecting heirs of someone deceased.  In Assets Unknown: How to Find Money You Didn’t Know You Had, David Folsom outlines the process people should follow to find assets owed to them.   Folsom notes that discovering these assets is easier than you’d think.  In addition to his book, he says a seeker simply has to use “her telephone, some stationery, and a little common sense.”

Folsom claims several success stories such as the retired school nurse who found $5,000 in retirement funds due her nineteen years after she left the job. Uncover any hidden assets you’re due by following Folsom’s advice or checking out www.unclaimedassets.com. 

Get Freebies and Coupons from Companies

Many companies will give you products just for asking because they want you to try their brand.  To find a list of freebies, call for Freebies magazine at 805-566-1225 or search under “freebies” at www.google.com.

Or if you’re more of a “show me the money” kind of person, simply ask companies for coupons. Getting coupons on products you always buy is money in the bank.  Check out the internet (www.valupage.com) or contact a company directly for coupons.  Sandi Johnson of Bloomfield, Iowa regularly writes companies and compliments their products.  She has received free products, coupons, and other offers for a small time investment.

Asking for Discounts on Purchases

Many retailers are willing to sell an item for less than the listed price, but most consumers don’t think of asking.  With mark-ups of 20-100%, stores have plenty of room to lower prices and still make money.  So ask.  Also, be knowledgeable.  Come armed with competitive prices from other stores or the internet.  And if you’re not satisfied, use the greatest power you have -- walk away.

One effective technique is to offer cash when negotiating.  Nancy Dunnan points out that “retailers, restaurants, and hotels pay 2% to 5% to the credit card company when you use your card.  If you pay cash, bargain for a discount.” But 2% to 5% is just a start. There’s something magical about cash that just makes people want it.  The powerful sight of five $100 bills for that $750 couch will be hard for many managers to refuse.

Dave Ramsey, best-selling author of Financial Peace, wholeheartedly recommends bargaining with cash.  And so he should.  Ramsey bought his three-year-old van for $4,000 below wholesale book value simply by “laying out sixty $100 bills in front of the seller.”  As Ramsey placed the last bill down, the seller scooped them up and said they had a deal.  Kelly Talcott from Nashville, Tennessee offered $350 cash for a $500 mattress.  The combination of a slow sales season for bedding (the holidays) and the offer of cash was enough for the salesman to accept immediately.  Talcott then got him to throw in bed rails and delivery for free.

These are just a few unique ways you can create cash.  Use them to give your family that extra cash you need.

Update: Check out Outside the Beltway.  I'm part of the Traffic Jam!!!

Comments

[Rich Chartier]

I disagree that you should spend cash. First of all I know that when I have cash I tend to blow through it quick. I nickel and dime myself by buying little knick knacks here and there. I know some studies have shown different but that doesn't hold true with either me or my wife.

Second of all with all the great cash back credit cards on the market now it's foolish not to take advantage of them. I get 5% cash back on all my gas and grocery purchases and 1% on everything else. Also credit cards allow you to float your money for up to a month and half and draw interest on it long after it's been spent. The only people who should use cash only are people that are not able to use credit responsibly. I know there are a lot of people like that and that is probably what produces the stats cited above. If you have disipline then you can save a 1,000 bucks a year easy by putting all your expenses on a credit card. Also for large ticket items credit cards offer protection that cash doesn't. If something goes wrong with the product your credit card company will stand behind you and they always take your side against a vendor.

[CLC]

That's just not true. I've had a creditor take the side of the vendor before. Bargaining with cash is irrefutable. I was able to buy a brand new bass rig for $500 under wholesale simply because I had $2,000 in my pocket.

[Lee]

I'm was like Rich. If I had cash, it used to drip through my fingers. Now I seriously begrudge spending any of it if I do have it.

My life is still run on plastic for the most part (but mostly debit rather than credit). I like being able to check my spend via my statements and online for years to come... you just don't get that flexibility with cash unless you religiously itemise your purchases in some fashion.

Plastic has its place. It's the mindset that needs changing, not the payment method.

[Lee]

And I apologise for the exceptionally poor grammar in the first line of my last comment. In my defense it's nearly 2am here in the UK ;)