If you are lucky enough to have a sweetheart (lover, special friend, paramour, cuddlebunny, etc), now is the time to be thinking about how you are going to celebrate the holiday. I know that the pressure is on – my own spouse has been hangdog for weeks trying to extract from me my preference between jewelry and pampering (a pedicure and spa day) in advance of the big day, despite the fact that I don’t think much of Valentine’s Day on the whole. Here’s my advice for the fourteenth, however unsolicited: put your credit cards away someplace safe, and fight back the urge to go nuts. It is just far too easy to run up crazy charges on your plastic in the quest to get the big day just right, when people are frequently losing the true meaning of the holiday in a demented festivus of consumerism gone wild.

I made the mistake of wandering into Target the other night while waiting with a friend for our movie to start, and was dumbfounded by the assortment of red and pink merch that was on display. This was more than just your normal assortment of heart-shaped candy and faux roses in bud vases. There was abundant evidence that Valentine’s Day home décor is rapidly becoming a “thing,” much in the same way that people now go crazy decking the halls for Halloween and Easter. I saw Valentine’s Day themed throw rugs, wall hangings, paper lanterns, centerpieces, and knick knacks. There also seemed to be an entire aisle devoted to the creation, serving, and consumption of homemade VD tasty treats, from cookie cutters to sprinkles, from blush-hued spatulas and heart-shaped measuring cups (how impractical!) to festive plates, chargers, cutlery, table linens, and tumblers. There were even aprons embellished with lace and a splattering of hearts. This was in addition to the piles of cupid, heart, LOVE, and kiss-emblazoned clothing, from cheeky lingerie to bawdy boxer shorts, cute tees for the kids and suggestive ones for the grown-ups, hair decorations, candy-striped leggings, and even flannel PJs. Nor is the flood of pink and red limited to your local Bullseye: Go to the mall, the grocery store, the local mass merchandiser, or (Heaven forbid!) a jewelry store. Prepare to be dazed by the festoons of paper hearts, and the general mess of dart-stricken hearts, Cupids, and lipstick kisses that you see everywhere. It’s an epidemic, my friends.

There’s one thing that is common between all the goodies targeted at Valentine’s Day revelers – the opulent boxes of chocolate, the bottles of wine, and the taper candles to give a romantic glow – all of these things cost money! Let’s not even talk about how much money it costs to do things “right” and take your loved one out for a fancy dinner on the 14th. Many dining establishments charge special prices for meals on this day, meaning that you will pay big bucks for a meal that is very likely to be not all that special, considering the massive crowds and the hurrying that is probably going on in the kitchen. Many dining establishments will have special prix-fixe menus for the day, meaning that there is a limited selection and a set price. You can’t even treat your sweetie to their favorite dish!

Here’s an idea: this year, give your loved one a kiss and nothing more. An old song got it right when it said that the best things in life – and I daresay that love qualifies – are free. Chocolate is nice, but it’s not free… ergo, it doesn’t factor into the equation. If you go the traditional route and give your darling a dozen red roses (around thirty bucks this time of year), a box of scrumptious sweets (twenty to thirty bucks, again), a great dinner out (one hundred twenty bucks, if you add the wine selection), and a fancy dessert at home with candles and rose petals (forty bucks again), you could easily blow half a week’s paycheck on one night out! Why – just because society dictates that this is the one day of the year that you need to be ostentatious about your love for one another? It’s a farce. Don’t do it. Trust me. If you really like candy, go hit the stores on the 15th when it is 50% off. It will taste just as good. And if that isn’t a lesson about the important things in life, I guess I don’t know what is.

As one final word, let me tell you the same thing that I told a gentleman friend (no, not that kind… I’m happily married) who was considering a Valentine’s Day proposal of marriage to his beloved. He asked me what I thought, and I couldn’t tell him NO! vehemently enough. If you have a steady sweetie and were thinking that February 14th could be the day that you pop the question, I beseech you to think again – unless you already have chosen and purchased the sparkler that you intend to slip on her dainty little finger. Because this IS the prime season for proposals, a lot of jewelry stores have already upped the prices on a lot of unspectacular diamonds, thinking that love-stricken men desperate to get the timing right won’t notice that they are getting a subpar stone for a Tiffany’s price. Wait until March, and then stage your dreamy proposal. Your credit card will thank you, and your beloved will be too swept off her feet to car about the calendar. Anyway, let’s be totally honest here – Valentine’s Day proposals are a bit tacky, anyway!

Let me say one thing off the bat, for those of you clutching your pearls and freaking out on the other side of the computer screen: credit card rewards points themselves are not taxable. If you use your rewards cards strategically to game the best virtual income this way, rest easy. Depending on how you obtain them, rewards may be taxable as income, according to tax experts and the Internal Revenue Service. People who covet and collect rewards can rest easy. The traditional rewards points earned when making purchases with credit cards or debit cards are still tax-free. It’s credit card reward point ‘gifts’ that are taxable, says the IRS.

To differentiate, think about the perks and goodies that are given away as part of recruitment drives for new banking accounts of all sorts. The value or worth of these promotions is considered income, and if it exceeds six hundred dollars, banks are required to send 1099 tax notices to both the IRS and the rewards recipient. Depending on the taxpayer’s deductions, tax bracket and other income, the rewards bonus could turn into tax liability. Mark Steber, chief tax officer for Jackson Hewitt, the nationwide tax preparation service, warns that, with the “scope, the size, the simple magnitude of the gifts… all increasing,” more and more taxpayers may be on the hook without even realizing it.

Banks have seriously upped their levels of rewards in the face of revenue losses over the past two years courtesy of federal regulators cracking down on abuses in the financial industry. Banks can no longer count on billions of bucks in income from overdraft fees, late fees, overlimit penalties, and the interchange fees that used to go cha-ching cha-ching each and every time that a cardholder swiped their debit card at the point of sale. Banks are now pretty desperate to re-accumulate lost business. One way that has sprung up in popularity is offering tempting incentives to customers who commit to opening new rewards accounts. The most common? Giving away twenty-five- to forty thousand free rewards miles or points to new customers who meet purchase thresholds in the first ninety days after signup.

The competition for consumer sign-ups is turning into something of an arms race, says Steber, with credit card companies vying to outdo one another with bonuses. These companies desire customers: their services, their deposits, and their card purchases. They are willing to go to extremes to get them, and that means offering bigger and bigger rewards. They are all trying to outdo one another, and the customer wins from this competition. Well, kind of.

The IRS has never really had to pay much attention to credit card rewards sign-up bonuses before now, for two main reasons. First of all, up until recently, the type of rewards classified as income rarely – if ever – met the six hundred dollar threshold at which issuers had to report them. Secondly, the very type of reward that people are receiving the most – the points that they accumulate for big trips or splashy merchandise – have been earned as the result of the consumer making purchases with a credit or debit card. Citi spokeswoman Emily Collins points out that “rewards and airline miles that are provided in connection with a purchase on a credit card are routinely not subject to individual income tax reporting,” Citi spokeswoman Emily Collins, said in an e-mailed statement. And yet, on the other side of the coin, when a consumer receives some sort of a gift or incentive for opening a checking account “whether cash, a toaster or airline miles,” as Collins puts it – the value of that gift is, in fact, almost always considered to be income and therefore subject to being reported. This is a unique, distinct entity from miles or points earned by credit card customers for their purchases. It’s a picky distinction, but one that counts to the IRS.

Citibank blew the issue open and put it at the forefront of public attention when it sent out a flurry of 1099-MISC notices to customers who took advantage of a 2011 Citi promotion that offered 25,000 American Airlines frequent flier miles to anyone who opened a new bank account. One such customer told Bankrate.com that he was deeply surprised to see the notice showing six hundred forty-five dollars in “income” for the frequent flier miles. Citi, on the other hand, claims that the standard disclosure found in the terms and conditions of its promotions and on its ThankYou rewards program website makes this statement: “When frequent flier miles are provided as a premium for opening a financial account, it can be a taxable situation subject to reporting under current law.” The disclosure goes on to spell out the fact that, in accordance with federal tax code, Citibank may be required to file a 1099 form with both the consumer and the IRS for the tax year in which rewards were issued, and that customers are “solely responsible for any personal tax liability arising out of the redemption of ThankYou Points.”

An IRS spokeswoman, Michelle Elderidge, confirmed that Citi’s procedures for reporting were the right ones. Frequent flier miles given away as a “premium” for the opening of a new account can, in fact be considered taxable, she stated. Elderidge urged all rewards card customers to consult with a tax prep professional to determine what, if any liabilities they might have for rewards gifts they received in the past tax year. She stated that customers who have more than one account with a bank or who received multiple rewards for different promotions would receive a 1099 for the total amount received during the tax year. She points out: “The IRS also notes that information on a particular Form 1099 may include various different sources of income from the issuer.”

Tax experts say that being issued a 1099 for credit cards reward “income” is quite rare, and that there is little chance that Citi’s 1099s impacted more than a few of its customer base. Eric L. Green, a tax attorney with the Convicer & Percy law firm in Connecticut quoted by CreditCards.com, states that he has “yet to see” any of his clients receive a 1099 in conjunction with a rewards program. He disagrees with the section of law that would, theoretically, count such rewards as income in the first place. He states that credit card companies give consumers something of value – which, “in theory, would be income.” Still, says expert Steber, don’t take such statements as carte blanche to ignore a 1099 from a bank if one is sent to you. Nowadays, the IRS is quite efficient at tracking income. Should a taxpayer fail to report a 1099 income that has been submitted, they could easily trigger an IRS letter and the threat of a penalty.

Traditional rewards that many rewards card users have come to love are still safe and tax free because they are tied to purchasing something with a payment card. Many of the promotions currently on the market offer rewards points to sign up for credit cards with a caveat that the applicant must make a minimum amount of purchases within the first few months of opening an account. Those rewards are contingent upon spending. Steber explains the difference thusly: traditional rewards are “considered a reimbursement of the fees that you’re paying in association with being a member. It’s a rebate of your fees.” This structure, he says, accounts for the way that a great many rewards programs are set up.

The tax liability comes in when the reward is not tied to purchases you have made. This puts credit card rewards in the same category as prizes you might win on a TV game show, or those fabulous presents given away by talk show hosts like Oprah Winfrey or Ellen Degeneres. If these gifts exceed six hundred dollars in value, they must be claimed. It was a lesson that Winfrey’s studio audience learned the hard way in 2004, when everyone received a new car. The IRS said those are taxable property windfalls,” Steber says. “That’s what this [rewards gift] falls into.” You are so excited about winning a new car that you don’t register anything but happiness, he says, but you end up owing about seven thousand dollars – a rough estimate of the taxes on an average new car – and may not know it until April.

An interesting fact to emerge from the examination of this phenomenon is the realization that many banks simply don’t bother to get involved in reward income reporting, figuring that customers can figure out the tax implications of their swag on their own. Wells Fargo doesn’t offer rewards points for signing on for new credit cards, says spokeswoman Lisa B. Westermann. “Our giveaway for opening a checking account is usually a plush pony, which wouldn’t require a 1099,” she says. Wells Fargo’s disclosure reads: “Any tax liability, including applicable state sales tax and state and federal disclosures, connected with the receipt or use of a reward is your or the reward recipient’s responsibility.” At Discover Financial Services, customers earn cash back bonuses when they use their Discover More and Open Road cards. The bonus points can be redeemed for statement credits, gift cards, merchandise or to donate to a charity. It’s not that nobody considers credit card rewards to be income, as attorney Green stated – it’s that they simply don’t care.

Discover spokesman Matthew Towson explains that, with the Discover Miles card, customers earn air mileage points. With every ten thousand miles accumulated, customers have the option to trade in their points for one hundred dollars off the price of an airline ticket or redemption for gift cards or similar value. He states that the cash back bonus itself is not taxable per federal law, since it is technically considered a rebate and therefore not subject to taxation.

This brings up another salient point in the issue of credit card rewards and taxation, which is the value of non-currency rewards like points. To wit: how much does 25,000 in airlines miles equate to in dollars? Citi’s policy says: “The valuation of ThankYou Point redemptions for Form 1099-MISC tax reporting purposes will be at Citibank’s sole discretion.” Steber from Jackson Hewitt says the valuation is “complicated on a good day … You value it when you have the unrestricted right to it or when you have unrestricted use of it. What are miles worth? They may not have any readily ascertainable value.” After all, air prices change drastically. There is no fixed form of valuation.

According to Steber, the rewards tax issue is just part of the larger problem of Americans largely underreporting their income. The only reason Americans would ever even think to report “earnings” from credit card rewards is because the bank in question sends out a 1099 form documenting the gift to the IRS. If the six hundred dollar threshold isn’t met or the bank doesn’t report the gifts, there is a great chance that the IRS will remain clueless about how much taxpayers receive in this manner.

Still, the burden is on taxpayers to accurately report their income – and that includes sources that they might disagree with. Many don’t, but they should. The IRS believes that the underreporting of American income was the single biggest contributor to the tax gap in 2006. That gap is defined as the difference between what Americans owe in taxes and how much they actually pay. In 2006, the most recent year available from the IRS, that gap stood at $450 billion. Of that, $68 billion was from underreported personal income. Steber puts it thusly: if you make money (from your eBay job, your bank, and/or your employer), you have to pay taxes. End of story.

If you have kids – and I say this as a proud parent – it can sometimes feel like your kids’ expenses are a line item all to themselves in the family budget. I like to make my kids happy, and that means that I spend a lot of dough at the toy store. Most parents I know are in the same boat. Did you know that Toys “R” Us offers a store card, one that offers discounts to frequent shoppers? If you heard this and got excited, just hold your horses. Saving money on kids’ treats and doodads may sound like a brilliant idea at the time, but I assume you that this “discount” is barbed. The whole premise of the card banks on gullible parents thinking that it is a fine idea to trade off on extra spending to get discounts on kids’ toys.

Nowadays, pretty much every major retailer offers some sort of credit card today as a way to pump discounts to shoppers and help drive up sales. Consumers treat their store cards like a badge of loyalty to their favorite companies, and fancy that they are getting special deals when they use their store plastic. Toys “R” Us is no different, and has built a thriving credit empire off this assumption. They actually just recently tweaked the framework of their credit card sector by cutting loose former financial partner JP Morgan Chase and starting a new branded credit card business backed by GE Capital Retail Bank. Through this move, the store claims, it will be able to offer customers new, better perks. You won’t be able to get your hands on one of these new cards until summertime, but in the meantime a hot debate over the worth of co-branded plastic has erupted amongst financial experts.

Store cards, which are “co-branded” with the label of a major card company (think: Visa, MasterCard, AmEx), are a different breed from their mainstream counterparts. They may look similar, but co-branded cards are not quite like the regular crop of department store cards out there, which you sign up for in-store and pay through the company itself. Co-branded cards are usually backed by a major bank that agrees to create a special card with rewards offerings directly targeted toward driving sales back to the retailer. You may think they are a handy tool for your wallet, but they are actually more like a handy tool for retailers to pad their bottom line.

It’s for this reason primarily that the financial pros at Nerdwallet advise consumers against signing up for branded cards. The internet site, which is devoted to credit card reviews and comparisons, generally disapproves of store plastic, as was made clear in a statement by VP Anisha Sekar in which she said that these types of credit cards are “almost never a good value.” The rewards may sound sweet, she admits – two to three percent rewards at the issuer’s own store plus one percent elsewhere is common – but there’s one important thing to remember. The types of purchases you can make with these cards are quite limited (just toys, for instance, with a TRU credit card), plus, as Shekar says, you often receive rewards in the form of a gift card that can only be used in-store… promoting yet more spending.

The pros at Your Money took the new Toys “R” Us card out for a test drive. They claim that they wanted to see how the card would stack up to its competitors, but the store was less than forthcoming in sending a representative to make things happen and cough up a copy of the card’s terms and conditions for closer examintation. Instead, the Your Money team poured over a review from Creditforum.com, which examined the fine print. The toy store’s current card charges a variable interest rate (key word: variable) ranging between 15.24 percent and 19.24 percent. Even on the low end of that scale, that’s a really high interest rate! Plus, just like Sekar said, the store rewards customers four points for every dollar they spend in-store, but only one point for eligible purchases made elsewhere. For every $250 you spend (1,000 points), you’re treated to a $10 coupon to be used in-store BUT you’re limited to only three per month. Stingy – if you spend a thousand bucks at the store, for instance (let’s say it’s your kid’s birthday… and that your budget is much bigger than mine!), you would earn a measly thirty dollars in rewards.

Let’s be real here – with an interest rate that off the wall and the requirement that you spend money to “save’ in stores, this really isn’t a great deal unless you plan on buying a couple hundred Barbie dolls every month. It’s a thought with which Sekar concurs: “Unless you spend a disproportionate amount of your budget at that store —let’s say 25% or more, unusual with Toys “R” Us—you’re better off with an all-purpose rewards card that gives more than 1% back on all purchases, or on one that gives rewards on a broad variety of purchases: department stores, say, instead of just at one store.” So don’t be tempted by momentary rewards.

Although September and October 2011 showed us a misleading “pop” in the retail sector (with gains of 0.7% and 0.5% respectively), Christmas sales just didn’t measure up. Despite the fact that the malls looked pretty darn busy from where I was parked, overall retail sales edged up only a mere 0.1% over November levels (or 0.2%, leaving out sales of automobiles), the slowest rate reported since May, as economists and analysts were quick to point out. That compares to economists’ forecasts of a 0.3% advance. These unimpressive results are reflective of consumers’ own uncertainties and cloudy outlook at present. While it’s true that the unemployment rate is finally budging downwards and that consumer confidence is measured to be rising, experts predict that it will take a lot more job creation and growth in income for those consumers to feel comfortable opening their wallets and spending freely, rather than prowling the stores in quest of seventy-five percent discounts on cashmere sweaters and electronics.

But let’s not throw the baby out with the bathwater. Although the December data may be a worrying sign for those monitoring macro trends in the expectation that they will drive financial markets, it would be silly and short-sighted for investors to view all retail stocks through the same prism. Yes, some retailers’ results for December were just plain disappointing. One example of that was Best Buy (BBY -1.90%). CEO Brian Dunn tried to explain the fact that visits to the electronic retailer’s stores climbed in the fourth quarter, and yet the chain still couldn’t seem to drive up profits in a corresponding way. The company couldn’t manage to turn visits into sales – or profitable sales, anyway. It isn’t really surprising that the stock trades at a mere 8.15 times trailing 12-month earnings, but the phrase “value trap” springs to mind, especially since sales of electronic products plummeted by a dismal 3.9% in December.

A surprising winner in the December retail race was Macy’s (M -1.77%). All the writing was on the wall for the department store to have a lousy Christmas season: department stores as a category saw their sales slump 0.8 percent in December. Target (TGT +0.02%) and J.C. Penney (JCP -1.52%) were among the numerous losers in this corner of the retail market, posting sales results that didn’t match their own targets. After cutting prices to move merchandise, some of these firms have been slashing their profit forecasts. Keeping stores open from dawn until midnight and offering big bargains just wasn’t enough to get people excited about shopping in the big boxes. Out of nowhere came Macy’s, which is now anticipating growth in same-store sales of 5.3% to 5.5% for the fourth quarter, a full percentage point above an earlier forecast and well above the 3 percent gain the retailer predicted at the beginning of the year. Given that luxury retailers did better than most other categories of retailers (since the much-vaunted one percent is still shopping, it seems) the upscale Bloomingdale’s division of Macy’s contributed to those gains. But management is sharing the wealth: It doubled its quarterly divided to 10 cents a share last July and just announced plans to do it again, to 20 cents a share to shareholders of record March 15.

But if Macy’s proved that not all department stores were created equal, then Tiffany & Co. (TIF -1.15%) proved that not all luxury brands were moneymakers this holiday. The company reported poor same-store sales, forcing it to trim its own profit forecasts. Again, assumptions simply can’t be trusted when it comes to holiday retail!

The moral of this story is that it is foolish in the utmost to make any sweeping general assumptions when it comes to the retailing industry, and especially in the month of December. You can’t use one firm to judge another, even if it seems to make sense to lump them together. Take, for example, the comparisons of yuppie clothier The Gap and colorful, funky footwear company Crocs. One firm aimed at middle-class consumers of clothing and footwear -The Gap (GPS +0.66%)- may be battling to convince customers to buy, even as another -Crocs (CROX -0.49%)- predicts that sales of its clunky clog-like footwear in a rainbow of colors have been so robust that its revenue is set to top $1 billion for the first time in its history. (Shoe retailers like DSW are doing well, too; DSW recently boosted earnings guidance.) Lesson? Middle-class shoppers were loving shoes and not clothes this year. Who would have guessed?

There is just no making foolproof predictions about retail performance, because the human factor has proven time and time again that it will provide a spoiler every single time. It might be easier to treat the retailers as if they responded in unison to the same economic trends, but that simply isn’t the case. You are likely to get foiled, and doing so means running a twofold risk: losing money as some retailers lag their peers, and losing the opportunity of outperforming the broader market as some companies do an exceptional job and are rewarded for it… even in a lackluster economic environment. It’s best to just sit back and watch the numbers roll by.

Another pretty foolproof way to save money is to keep tabs on your use of electronics. Many people in this environmentally-conscious day and age already do this, but make sure that your household is in the habit of unplugging appliances whenever possible… not just turning them off. Apparently, unplugging the TV instead of just switching it off can save a lot of electricity! When not in a room, switch off the lights and the fan. It takes a little while to get in the habit, but you will soon be doing it without even thinking. Also, consider the use of a programmable thermostat to control your A/C and heater usage. Yes, you may need to shell out a little bit of money to replace the one that you have, but the savings can really justify the initial cost before too long. At the very least, educate yourself on what each appliance uses and unplug a few of them. You might really be amazed how much money you can shave off your electric bill, which is a major source of spending for many households.

You can also save money on your vacations, if you are willing to put in a bit of work. Some financial “experts” would argue that you should not indulge on a vacation if you are truly trying to live an austere lifestyle, but I argue back that getting away every so often is a necessary part of saving our sanity in the busy lives that we lead. There can be no realistic doubt, of course, that vacations are also a huge drain on the family finances. Did you know, though, that you can cut the cost of a vacation significantly by planning and booking ahead of time? Well ahead of when you plan on leaving town, be sure to bookmark travel sites for finding inexpensive airfare, hotel etc., and book at least two weeks in advance for the greatest savings. Make sure that you always weigh the price of driving somewhere versus taking a plane when you have the time to do so, since fluctuating gas prices can really change things in this issue.

As a final lifestyle tip towards saving money, do yourself a favor and keep your distance from lavish, high-roller friends who will set a bad example and encourage you (either to your face or subconsciously) to break your budget habits in an attempt to keep up with their free-wheeling spending. You know the type of folks I am talking about: they buy a new car every other year – or worse yet, lease it; they have large screen TVs, iPads, iPhones, and every other conceivable electronics gadget from the day it hits the market; they eat out at fancy restaurants every other night, and they generally live way beyond their means. Please do yourself a favor and keep your distance from these folks, no matter how nice they may seem. It’s not that these people necessarily mean you any harm, and it’s not that they are bad people – it’s just that jealousy is a bear, and there’s no need to expose yourself to discontent and longing when you are making positive steps towards improving your financial situation and staying on the right track. What’s more important – your friends or your peace of mind? Keep in mind that all their goodies now won’t mean much in a few decades when you have a well-funded retirement fund and no debt.

With all this said – I’m not necessarily saying that you should take all these tips to heart and follow each and every one. Just as too much work and not enough play can make Jack a dull boy, so can too much frugality suck the juice out of life. Being too cheap can make both you and the people around you very miserable – and yes, there is a difference between thrifty and cheap. So, pick out a few tips at a time that will work for you and make them a habit, before deciding if you can incorporate more money saving habits in your daily routine. You may really go with some of them, you may lose some and pick up others. It may take some time for you to really get in the groove of what lifestyle habits you want to stick with to help you realize your personal goals of financial solvency and freedom from debt. It’s worth the time and effort that you expend. Any steps you take towards a financially-healthier future will pay dividends in the long run!

Let’s talk about your car for a moment. I know that most people don’t want to hear this, because most of us enjoy having a shiny, late-model ride, but you really should aim to keep your car for as long as possible. Sure, you can buy a new car every two years in an attempt to Of course, when you have an older car, you always need to be mindful of the point where it is no longer frugal for you to hold on. There are numerous online resources for calculating the balance between the money spent on repairs versus the monthly payment on another vehicle. As long as the maintenance costs are low, it makes sense to drive an old car for as long as possible.

To that end, make sure that you are staying on top of regularly scheduled maintenance on your vehicles. Sure, it can seem tempting to blow off an oil change or belt replacement if funds are tight, but these are not savings that will pay off in the long run. Please, for the sake of your wallet, do not skimp on or forget to do regular oil changes. Remember to check the air in your tires often, and to have the proper tools to gauge the correct pressure. Always use the grade of fuel that the owner’s manual recommends. These small acts can significantly lengthen the life of your car, giving you years of use that well justify the minor expenses of keeping your auto running smoothly.

If your trusty ride finally shifts over into the category of a junker, or if your vehicle is totaled in an accident, you will ultimately need to get another car. Here’s a pro tip: don’t buy a new car. In almost every case, a pre-owned vehicle is the right way to go. A used car has already weathered that tremendous initial depreciation, whereas a new car depreciates significantly the moment you drive it out the dealership, but the loan you take out will still be for the new, marked-up price! Is the new car small really worth thousands of dollars in negative equity on your auto loan? I’m thinking that the much-coveted “new car smell” just isn’t a worthy trade-off. Pre-owned cars that are only a few years old with low mileage are the best bargains, especially when you pick them up at a dealership that has maintenance guarantees on them for the first several years. Of course, getting a good price on your new-to-you car is just as important as making the decision to buy used in the first place: you absolutely must learn to negotiate with car dealers. This is not the place to go into those details, but there are plenty of resources to help you settle on a fair price when you deal with car dealers.

Another reliable way to save some money is to give your car a break and either ride your bike or carpool whenever possible. Unlike using gas and oil, which both cost lots of money, the power of your own two feet is free – making a bike your best (not to mention healthiest) bet. Unfortunately, many cities in America simply do not have the infrastructure to accommodate bicyclists and/or pedestrians, and it is almost impossible to get by without a car. That said, just because you have a car does not mean you have to use it every day. Sharing rides to work with a few coworkers (or sharing with a spouse, should your schedules work out) will save both gas and carbon emissions, which is another move that is not only frugal, but good for Mother Earth.

If you are a stay-at-home type (like me!) and watch a lot of DVDs for entertainment, go ahead and splurge on an online DVD store membership. This is another case where a small initial outlay of cash turns into a very worthy investment in the long run. After all, membership to online movie stores like Netflix or Blockbuster Online can save you a lot of money compared to buying DVDs or renting it from a local store. Buying a movbie the week it comes out – when they are usually on sale, granted – will set you back fifteen to twenty dollars a disc. Heaven forbid you prefer BluRay, because then you are really looking at a pile of cash to build even a modest collection! And renting discs from a regular video store will often cost you about five bucks apiece, which is still a ripoff. True, if you order a movie online with Netflix, you will need to wait to get it in the mail. I can tell you as a Netflix user of years, however, that if you watch a lot of movies at home, then you can easily get into the habit of ordering ahead of time so you always have something at home. I simply set my queue with plenty of movies I’m interested in, so there is always something appealing to watch. And honestly, it takes maybe two days for Netflix to get me a given movie. The wait is well worth the money saved, in my humble opinion. As a second option: if you are patient and your library has the resources, check to see if they have a movie section. You won’t get anything very new, but they are free – and you can’t beat that for frugality!

Before you buy anything expensive at all, you should be running a price check. Ideally, you can set a price alert for the item(s) you want and track the prices so that you can grab a great deal when it comes along. Frequently available online coupons make it even easier to save some money. This is especially true while purchasing any electronics. You should never just jump into a purchase without doing research into how you can best bring down the price of your chosen item.

We touched on this earlier with regards to groceries, but it’s a general rule that you should always avoid impulse purchases. Do you really, REALLY want something? Make it a personal rule that you need to wait at least twenty-four hours before buying it. You might be surprised that, after a “cooling off” period, that item no longer seems all that necessary. If you really still want it, at least you have had a bit of time to check prices and make an informed decision to buy it at the best possible price. But I know that I am often surprised by how seldom the time and effort does not seem worth it to go back for that item I so desperately assumed I couldn’t live without!

Another area where we spend a lot of needless cash is on bottled water. Yes, water is best for your health, and it’s great to drink a lot of it. Some of the healthiest people I know are never without their trusty cup of H2O. On the other hand, bottled water is anything but healthy for your wallet. We tend to like drinking water in this format because it is easy to tote around and helps prevent spills. Still, there is no reason – financial or environmental – that you need to be constantly buying and then trashing water bottles. Consider saving those bottles to refill with tap water a few times. You will buy water a lot less often, yet won’t give up the convenience. Of course, the best buy of all is a BPA-free plastic water bottle that you fill time and time again! If you dislike the taste of tap water, invest in a Brita faucet filter or pitcher. In time, you could save yourself a lot of money!

Speaking of plastic: you should stay far away from credit cards with annual fees. While credit cards with their cash back bonuses and reward points are a great way to save some money, annual fees are a way that banks greedily suck the oomph out of your wallet, even if you are diligent and pay your balance off each month. When you are weighing your options on which plastic to use, always opt against a card that carries an annual fee. It’s not as if there is a shortage on rewards cards that DON’T make you pay for the privilege of using them, so it’s not as if the use of an annual fee card is ever justified. Just say no!

Another great way to save money painlessly is to part ways with your landline telephone. Unless you have small kids in the house (who need to be taught to dial 911 in an emergency) or old people, you are very likely safe with just your cell phone(s) and no landline. I personally have been without a traditional telephone for over seven years now, and I don’t ever miss it. Our internet, like that of so many other folks out there, comes via cable. Now that our older children are toddlers, I suppose we may need to reintroduce a landline… but it will be with regret on my part, because I honestly don’t think a landline is useful ninety-nine percent of the time. I know that my parents still have a landline, because they have a fax machine, and I have literally never seen them use it in the last half-decade.

Here’s a real money saver: stop buying books. Yes indeed, my friends, stop giving Amazon your business. This is another of those no-brainers, but books are always free at the library. Most libraries are well-stocked, and in this digital age, you need not even be restricted to just the book supply at your local branch! In my county, for instance, the library branches are connected electronically. I can request and reserve any book in the system, and have it brought to my local branch for pickup. It’s super easy and convenient. There have been very few titles that I couldn’t obtain in recent years by this method.

Do you buy trash bags/bin liners for your small trash cans, like the ones in your bathroom or office? Shame on you. That four or five dollars a box could be easily saved by using plastic grocery bags to line your trash. No, that bag will not work for your big kitchen trash can – but there’s no excuse to buy expensive bags for little cans! Remember that we are literally talking about something that is bought solely to throw away. Reusing plastic grocery bags anywhere you can in the home is not only a great way to save a few bucks over the course of a year, but it is also vastly better for the environment in the sense of keeping extra plastic out of landfills.

Let’s talk about debt for a moment. If you want to truly save money in 2012, there is no better way to start than to commit to consolidating and eliminating debt as quickly as possible. Every month that you carry debt on your credit cards, you are paying interest that need not come out of your budget! Of course, paying down debt is not an overnight process. If you carry balances on your cards, make your first priority to consolidate your debt to a lower interest and to pay it off as soon as possible. Why spend your hard-earned cash to make the financial institutions rich? It can seem like a burden to eliminate our debt, but it we keep focused on our goals, it can really help the progress.

Towards the end of avoiding debt in the first place, be sure that you are paying your bills on time every month and avoiding late fees like the bubonic plague. To this end, make sure that you are organized with your regular monthly bills. If you can, try to automate your payments to prevent any forgotten bills. Nowadays, the majority of utilities and other recurring bills can be set to be charged to a credit card or deducted from a checking account these days. If not, know that many banks offer free bill pay programs. It’s easy to set up, with step-by-step instructions to baby even the most tech-ignorant consumer out there. In short, there is no excuse not to take advantage of these services and risk getting late fees! Fees, after all, are just money thrown away. If you choose not to take this advice and you do happen to forget a bill legitimately, gird your loins and make a polite phone call to the company in question requesting that your fee be waived as a first-time offender. If you are sweet and genuinely have a clean payment history, many companies will do right by you on this one.

Another account to watch carefully is your checking account. Be on the lookout for any low balances that could potentially lead to overdrafts! Overdraft fees are high, even with new laws restricting what banks can charge as penalties, and they will take a giant shark bite out of your paycheck. If you use your checking account often or have some bills that are paid automatically from your checking account, be aware of the balance and avoid overdraft fees. The best way to prevent trouble is to kick it old school and utilize a paper checkbook in which you record all your transactions. Use your online transaction log to balance your checkbook every week or so (depending on how often you use it), and you will avoid trouble.

The next tip is one that I myself started using halfway through 2011 with great success: making a list before going shopping. This has saved my butt at the grocery store, and really put the kibosh on all those midweek trips to pick up “just one or two things” that ended up costing thirty or forty bucks every single time. Look, there’s a reason that “impulse buying” has the name and reputation that it does. It’s not your fault specifically; humans are just hardwired to resist the temptation to purchase extras while shopping. Without a list you will buy items that you simply do not need. It’s so much easier to stay focused and on-task with a list – take it from someone who does it! Plus, you will curtail that annoying feeling of going to the store and forgetting everything you came for. I myself plan meals out for two weeks when I go shopping, and write down every ingredient I will need. I shop off that list (plus other essentials like snacks, non-edibles, etc.) and aim for zero extra trips out during the next two weeks. I have managed to make it work! Just know that getting all that you need in one trip can help avoid another unnecessary trips (no wasted gas money) and temptation both.

Speaking of grocery shopping: do you purposely go shopping when you have plenty of time to linger, knowing that it can be a time-consuming errand? Well, stop that! The pros advise you to actually go grocery shopping when you know that you have somewhere to be in a few hours. It sounds counterproductive, but grab that list (that you already wrote out, naturally!) and run to the store when you are in a hurry. What you are aiming for is a very speedy in-and-out trip with little time to hang around and get tempted to buy things you don’t need. Try going after work, knowing that you need to get home to make dinner. Or even on a night when you know that your favorite TV show is coming on!

Another important way to save money is by minimizing waste. To that end, while we are still talking about groceries, be sure to watch out for expiration dates on perishable goods when you are out shopping. This sounds so elementary, but think about it: do you always remember to check the expiry on that gallon of milk before you throw it in your cart? What if you grab one that is set to expire in just a few days, and you tend to need your milk to last a week or so? This also goes for fresh meat, eggs, yogurt, spreads, frozen goods, and items from the deli or bakery. Sure, you can probably use the item a few days outside its sell-by date and be just fine – but is that really how you want to play the risk to your family? Sky-high medical bills for food poisoning can wreck your grocery budget for years! Best not to risk it and to pay close attention to these things before you leave the store.

If an item is not going to expire, however, don’t be afraid to buy in bulk. In fact, say the pros, you should embrace this form of buying when you find something for a great sale! Items on which it makes sense to stock up in large quantities include breakfast cereals, anything tinned or canned, staples like rice/beans/pasta, soda, toothpaste, bodywash, shampoo, and that holy grail of coupon queens everywhere: toilet paper. In terms of these items, buying a membership and shopping at Costco, Sam’s Club etc can save you quite a bit of money, provided you stick strictly to your shopping list when you shop at these places. If you have a big family that can burn through these items reasonably fast so that you don’t need to store it forever, all the better.