Cut your costs and pay yourself first

This was originally published on Monday, April 27, 2015, in the Pacific Daily News.  Click here to subscribe to the PDN.

Warren Buffet once said “do not save what is left after spending, but spend what is left after saving.” This quote reminds us that saving is important and that we should save before we spend — pay ourselves first. Finding areas in which we can cut back sometimes seems like a daunting task. If you track your daily expenses, you can find certain areas that you can cut. The hardest part is getting started.

Cut down on car bills

Automobile expenses are a large part of our budget. Especially on Guam, we rely heavily on our vehicles to get us to our destinations. We use them daily and keeping them in good working condition is a must. Maintenance is costly and although the fuel prices may be low right now, they could rise in the near future. Many of us neglect our car until something needs repairing. Our cars go through some rough conditions here on Guam. The heat, the salt air, road conditions, and stop-and-go traffic put extra wear and tear on the vehicles. Taking care of the little things will help avoid large expensive repairs later on. Sometimes, if the vehicle is older it could be the difference of small maintenance costs versus a new car with a new loan.

Avoid quick start-ups and stops. This causes the engine to use more fuel. Plan your trips so that you can cut back on the number of round trips and the amount of miles traveled. Plan your route to avoid backtracking. If possible, try carpooling.

You do not have to be an auto mechanic to learn how to check the fluids in your car. Many of them are easy to check and replace. You can go online to research how to replenish your vehicle’s fluids and which fluids to buy. Check your engine oil, brake fluid, coolant, power steering fluid, windshield washer fluid, and transmission fluid. These fluids are inexpensive. It is the cost of labor that causes the high prices of maintenance. A properly running engine can save a few hundred dollars each year.

Tires are another thing you can maintain. Properly inflated tires stay in good condition longer. Tires that are poorly maintained can blow out. Replacing your tires could be the least expensive alternative compared to a tire that causes an accident. Check your tires at least weekly. You can buy inexpensive tire plugs that stay green when properly inflated and turn red when you need to add air. Well-maintained tires can also save hundreds of dollars a year on fuel.

Being surrounded by the ocean is beautiful but it is hard on metal objects, especially your vehicle. Metal objects rust a lot quicker here on the island because of the salt in the air. Washing your vehicle at least monthly can help slow down the rust process. Be sure you clean under the car as well. Never wash your engine under the hood. There are many water-sensitive parts on top of your engine. Get your engine cleaned by a professional.

Clothes can cost you!

Clothing can be expensive if you have children. You might feel that you are constantly having to buy clothing. Name brands are expensive, especially for something that they will outgrow or ruin within a few months or years. Quality should not be overlooked. It may cost you a few more dollars upfront for a good pair of jeans versus buying several lower-quality ones. Look for deals at department stores. Usually items that are out of season are marked down drastically. Also try discount stores. These items are either out of season or slightly imperfect.

Get good deals

Thrift stores are another way to save money. Items are usually lightly used but are still in great to good condition. Look in the paper for yard or garage sales. Flea markets are also another source to find great clothing deals.

Try using the phone to shop around for items you need immediately. I recently bought a basketball for my son and a dodgeball for my daughter and saved a total of $25 just by calling the sporting goods store and asking for pricing and availability.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 20 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at and read past columns at the Money Matters blog at


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