Simple steps to saving big

Money talk is on the menu at many dinner tables across Hampton Roads. Just ask the Colliers of Hampton.

Homeowner Cecil Collier said, "We did many times sit around, saying 'Oh, how are we going to do this in regards to my daughter's tuition and her books?'"

This dual-income couple and parents of a college-age daughter brought in outside help - Financial Security Advisory in Virginia Beach.

How did Bob O'Brien and April Mano save their family almost $800 a month? And how can you do the same? They say all it takes is four simple steps.

Step one, start with a plan.

Write down exactly what you spend and where you want your money to go. Sounds simple, but financial advisors say people don't do it.

Step two, restructure your debt.

April Mano with Financial Security Advisory said, "By just restructuring the little bit of debt they have, from bad debt into good debt, it really freed up a lot of cash and allowed you to do a lot of things."
   
For the Colliers, that meant rolling the little debt they have into their home mortgage and getting a lower interest rate. 

Mano said, "Why do you want to pay interest on a credit card that's not tax deductible, when you can restructure soundly into a mortgage, still be responsible and take that tax deduction, which again frees up more money for you in your cash flow?"

Total savings there, $466 a month.
   
Step three, adjust the withholding tax with your employer.   

Bob O'Brien is the President of Financial Security Advisory.  He said, "You're paying too much in every year, so you get a big refund at the end of the year, but you don't need it at the end of year, because when you get that money back from the IRS, they haven't paid in any interest."

The Colliers are pocketing $272 a month with that change.
   
Step four involves taking a closer look at life insurance.
   
The Colliers switched companies, got more coverage and are saving an extra $60 dollars per month.

That's a grand total of $798 a month.

Homeowner Cheryl Collier said, "It's the kind of thing that you sit back and say, 'Why didn't I do this ten years ago, 15 years ago?'" 

The Colliers really didn't do anything differently to save this money.
   
But WAVY.com has learned, if they or you make other simple changes, like shop around for the best prices, bundle services, like your phone, cable, and internet for a discount, and increase your 401K contributions which will lower your taxable income -- you could save even more.

Mano said, "It's not just rich people that find money.  Normal, everyday working families can find money.  It's not hard.  It's proven principles."

And for the Colliers, the steps are already paying off, with a newer car possible through their refinanced mortgage.
   
They know their money is working for them, not the other way around.

By the way, a financial plan like the one the Colliers got costs on average $395.