Let’s face it folks – the average American is a compulsive spender, and here are the statistics to prove it. The American Consumer Satisfaction Index (ACSI) in May this year predicted that consumer spending was likely to increase, even as the growth of wages and salaries continued to slow down and the national savings rate went into the red. While increased consumer spending may be good for the national economy, it’s definitely not so for the bank balance of the average family, more so when you spend $12 for every $10 that you earn. It’s high time the purse strings were tightened, and we all started focusing on saving.

It turns out that the simplest ways to cut costs are the most practical ones – the lessons you learned from Mom, but somehow forgot all about as you grew up. Well, it’s not too late to jog your memory, dust those mental cobwebs, and get your financial act together with these easy cost-cutting tips:

1. A penny saved is a penny earned: Why did your mom place so much importance on your piggybank as you were growing up? Because money saved does grow, due to this magic fertilizer called compound interest. Mom’s recommendation - when your paycheck comes in, set up an automatic withdrawal from your checking account so that 10 percent is saved immediately. While the pinch may be felt for a few months, pretty soon it will be replaced by the bulge of the fattening savings account.

2. It’s wise to save for a rainy day: You’re in a good place right now, with a more-than-adequate income that keeps rising as you advance in your career, so what do you do? Raise your standard of living? No, not if you want to follow mom’s sage advice. A three percent annual increase in inflation will double your living costs in only 24 years. So let those extra dollars accumulate, beat inflation, and make sure you have a nice nest egg to fall back on when the cost of living surges upwards.

3. The first step is always the hardest: Yes, before you get down to some really heavy cost-saving measures, there’s the dreaded budget to set up.

Mom would tell you put all your basic necessities first, your mortgage, food, clothing and utility expenses, transportation, children’s education. The non-essentials can be worked in after that based on the income you earn. List your recurring costs and one-off expenses, and most important, don’t forget to add that amount for pesky, unforeseen contingencies.

4.  Don’t count your chickens before they hatch: Ok, here’s a vital aspect that needs to be taken seriously when preparing a budget, and mom will find it hard to forgive you if you forgot it. Never, ever take potential windfalls into consideration when calculating your monthly or annual income.

Among the things you consciously ignore are that promised pay raise sometime in the next quarter, that inheritance from the filthily rich maiden aunt on her deathbed, tax refunds from the IRS, the proceeds from property you hope to sell for a fortune, gains due to investments in stocks or mutual funds, and well, you get my drift.

5. A rolling stone gathers no moss: This one’s for those of you who are bitten by the wanderlust bug. Changing jobs too often? Can’t seem to find that perfect home? Not decided where to plant roots and settle down? If so, mom would tell you that you need to get your act together and set up home somewhere permanent. Too many changes in lifestyle add to the dollars spent unnecessarily.

6. There’s no place like home (and no food like home-cooked): Eating out or ordering in eats up a sizeable part of your income, without you being aware of it. The odd doughnut at the office, the takeout from the new Chinese deli that opened across the street, the chocolate bar and pretzel packet from the lobby vending machine – they may not seem like large expenses, but they sure do add up when you tally them at the end of a month. Mom would be proud of you if you brushed up those cooking skills she taught you and put them to use when trying to cut costs.

Home-cooked food is the cheapest and healthiest way to satisfy your hunger pangs.

7. Charity begins at home: Instead of going out to catch the new James Bond flick, stay in, and watch it on DVD, with snacks from your own larder, popcorn that’s fresh from your microwave, and lemonade chilled from the refrigerator. Mom would say you’ve achieved multiple savings with this move, from the movie tickets to the ridiculous cost of snacks at the multiplex theatres.

8. Penny wise and pound foolish: You’ve been a good boy and stayed true to your budget. No cups of coffee at Starbucks, no Diet Coke for lunch, no film glossy picked up at random at the corner newsstand, no pizza for dinner. Then bang, the bubble bursts, and mom’s not pleased with you.

Why? Because you just blew the pennies you saved, and a lot more, on a vacation to Hawaii, just because an airline offered to fly you there at a discount. The amount you save is peanuts compared to the added expense of a vacation. For two steps forward, you’ve moved ten steps back.

9. It’s hard to teach an old dog new tricks: If you’re a family man, mom would look more kindly on you if you passed on her valuable pointers to your own brood right from the time they’re in diapers. It doesn’t make sense to ask your pre-teens out of the blue to curb his spending habits when they’re just discovering the wonderful things money can buy. What they don’t realize at that age is the not-so-wonderful consequences that arise when deep in debt. Children who are taught the value of money from a very early age will be an asset when you’re trying to stick to a budget, cut back on your expenditure, and get out of debt.

10. Don’t put off till tomorrow what you can do today: Mom would definitely not advocate procrastination when it came to paying bills and credit card balances. Every late payment translates into extra costs in terms of interest and penalties incurred.

Let’s face it folks – the average American is a compulsive spender, and here are the statistics to prove it. The American Consumer Satisfaction Index (ACSI) in May this year predicted that consumer spending was likely to increase, even as the growth of wages and salaries continued to slow down and the national savings rate went into the red. While increased consumer spending may be good for the national economy, it’s definitely not so for the bank balance of the average family, more so when you spend $12 for every $10 that you earn. It’s high time the purse strings were tightened, and we all started focusing on saving.

It turns out that the simplest ways to cut costs are the most practical ones – the lessons you learned from Mom, but somehow forgot all about as you grew up. Well, it’s not too late to jog your memory, dust those mental cobwebs, and get your financial act together with these easy cost-cutting tips:

1. A penny saved is a penny earned: Why did your mom place so much importance on your piggybank as you were growing up? Because money saved does grow, due to this magic fertilizer called compound interest. Mom’s recommendation - when your paycheck comes in, set up an automatic withdrawal from your checking account so that 10 percent is saved immediately. While the pinch may be felt for a few months, pretty soon it will be replaced by the bulge of the fattening savings account.

2. It’s wise to save for a rainy day: You’re in a good place right now, with a more-than-adequate income that keeps rising as you advance in your career, so what do you do? Raise your standard of living? No, not if you want to follow mom’s sage advice. A three percent annual increase in inflation will double your living costs in only 24 years. So let those extra dollars accumulate, beat inflation, and make sure you have a nice nest egg to fall back on when the cost of living surges upwards.

3. The first step is always the hardest: Yes, before you get down to some really heavy cost-saving measures, there’s the dreaded budget to set up.

Mom would tell you put all your basic necessities first, your mortgage, food, clothing and utility expenses, transportation, children’s education. The non-essentials can be worked in after that based on the income you earn. List your recurring costs and one-off expenses, and most important, don’t forget to add that amount for pesky, unforeseen contingencies.

4.  Don’t count your chickens before they hatch: Ok, here’s a vital aspect that needs to be taken seriously when preparing a budget, and mom will find it hard to forgive you if you forgot it. Never, ever take potential windfalls into consideration when calculating your monthly or annual income.

Among the things you consciously ignore are that promised pay raise sometime in the next quarter, that inheritance from the filthily rich maiden aunt on her deathbed, tax refunds from the IRS, the proceeds from property you hope to sell for a fortune, gains due to investments in stocks or mutual funds, and well, you get my drift.

5. A rolling stone gathers no moss: This one’s for those of you who are bitten by the wanderlust bug. Changing jobs too often? Can’t seem to find that perfect home? Not decided where to plant roots and settle down? If so, mom would tell you that you need to get your act together and set up home somewhere permanent. Too many changes in lifestyle add to the dollars spent unnecessarily.

6. There’s no place like home (and no food like home-cooked): Eating out or ordering in eats up a sizeable part of your income, without you being aware of it. The odd doughnut at the office, the takeout from the new Chinese deli that opened across the street, the chocolate bar and pretzel packet from the lobby vending machine – they may not seem like large expenses, but they sure do add up when you tally them at the end of a month. Mom would be proud of you if you brushed up those cooking skills she taught you and put them to use when trying to cut costs.

Home-cooked food is the cheapest and healthiest way to satisfy your hunger pangs.

7. Charity begins at home: Instead of going out to catch the new James Bond flick, stay in, and watch it on DVD, with snacks from your own larder, popcorn that’s fresh from your microwave, and lemonade chilled from the refrigerator. Mom would say you’ve achieved multiple savings with this move, from the movie tickets to the ridiculous cost of snacks at the multiplex theatres.

8. Penny wise and pound foolish: You’ve been a good boy and stayed true to your budget. No cups of coffee at Starbucks, no Diet Coke for lunch, no film glossy picked up at random at the corner newsstand, no pizza for dinner. Then bang, the bubble bursts, and mom’s not pleased with you.

Why? Because you just blew the pennies you saved, and a lot more, on a vacation to Hawaii, just because an airline offered to fly you there at a discount. The amount you save is peanuts compared to the added expense of a vacation. For two steps forward, you’ve moved ten steps back.

9. It’s hard to teach an old dog new tricks: If you’re a family man, mom would look more kindly on you if you passed on her valuable pointers to your own brood right from the time they’re in diapers. It doesn’t make sense to ask your pre-teens out of the blue to curb his spending habits when they’re just discovering the wonderful things money can buy. What they don’t realize at that age is the not-so-wonderful consequences that arise when deep in debt. Children who are taught the value of money from a very early age will be an asset when you’re trying to stick to a budget, cut back on your expenditure, and get out of debt.

10. Don’t put off till tomorrow what you can do today: Mom would definitely not advocate procrastination when it came to paying bills and credit card balances. Every late payment translates into extra costs in terms of interest and penalties incurred.