Money Magazine has a feature this month about finding extra money or “hidden assets” as they call it. I’m not going to do a whole series on these suggestions, but I will simply summarize and add a few thoughts.
1. Cash in old savings bonds. If they’ve matured, you have money that’s not earning any interest. Cash them in and put the money in a high-yield internet savings account or something more risky if you’re so inclined. Search treasurydirect.com because you may not know that you have bonds in your name… yes, it is possible.
2. Boost your savings rate. I often talk, like I did one paragraph earlier, about getting out of low-paying brick-and-mortar bank accounts and into the world of online banks where you can earn significantly more on your cash. Money talks more about making the most out of your brokerage’s sweep accounts, where uninvested cash sits. Most brokerage have higher-performing, low-risk money market funds that provide a much better alternative for a sweep account.
3. Stop paying for unneeded life insurance. Money Magazine suggests arranging for your premium to come out of your dividends. This may be practical for some whose insurance needs are lower than they once were. Also, avoid sales pitches when you go to talk to your insurer.
4. Consolidate your retirement accounts. Too many accounts can be confusing and expensive. Simplify!
5. Prune your credit cards. Simplify! Get rid of unused cards. Consolidate cards. Close accounts (but leave your oldest credit card open for evidence of credit history).
7. Finally sell that lousy investment. It’s easy to get emotionally attached. “Take a look at every dud investment you own and ask yourself why you still own it. You are not allowed to factor the purchase price and the long-ago value into your answer.” If you take a loss when you sell, you can deduct it from your tax return to a point.
That’s what Money Magazine had to offer, but there are many other places to “find” money. Here are two I can think of off the top of my head.
8. You can “find” money just by creating an automatic withdrawal from your checking account to an obscure checking account immediately after your paycheck is deposited. You’ll never know the money’s not available like normal, and down the road, you’ll find you have a sizable chunk of extra cash.
9. Check your state’s unclaimed funds website. Here is New Jersey’s. I searched for my last name and determined the state has some money due to my father, which was likely sent to an old address. I keep forgetting to let him know…
Feel free to add any suggestions!