A、Electricity. B、Rent. C、Mortgage. D、Car payments. A

W: Hi, Leigh, good to see you.
M: Thank you.
W: Hmm, that sounds pretty ambitious because we are really gonna to be saying here that anybody, anybody, right? No matter what your income bracket is right now, you might be able to help accumulate a million dollars if you just do some very basic things. M: That’s very true, you know, it sounds like something that you have to either, you know, for a million dollars you have to win a lottery or else invent next Google, but really it’s surprisingly attainable for almost any household. It just takes commitment, and planning and disciplining across all aspects of your life really.
W: All right, well, let’s talk about the discipline. Let... beginning with health, you say taking care of yourself is not just about bow you take care of your money, but first you get start with taking care of yourself, how is it that it can save your money over the long term?
M: Well, it’s funny, you know, most people don’t really make the link between your health and your wealth, but it has a surprising effect. Everything from keeping your medical bills down as we know medical bills are a huge problem for many consumers, but also, urn, it’s been shown that people in better health actually earn more. This has been tracked and your salary goes up at a faster rate, and then in addition to that, you pay more for things like life insurance, a 40-year-old male who is in good health is gonna pay about $ 35 a month for a $ 500,000 life insurance policy. If he’s overweighted and smokes, it’s gonna be 4 times that, so you don’t really realize all the ways that your health is really affecting your own bottom line.
W: Interesting, and when we talk about saving money, we’re also talking about how you spend your money. So many things you really can’t get around, mortgage, rent, or your, you know, car payments, etc, but you say you really can be smart about how you try to negotiate your mortgage rates, or perhaps how you spend your money on your car payments, you think used instead of new or leased new.
M: Absolutely. Yes, you think you can get around in these things but you can’t. I mean 1% change on your mortgage, that’s just lower your rate by 1%, and that will save an average household about $ 22,000. So you know that’s a big deal. The same thing with cars, if you lease a pair of new cars, and then you switch to buy a pair of used cars every 5 years, that will bring your cost down by about $ 31,000 over this 10-year period that we’re talking about. So that is significant.
W: Woo, that’s taken a consideration though the kind of maintenance bills you are more likely to have when you buy used for a lease or you buy something real.
M: That includes ownership cost which we factor in to be maintenance, repairs, everything.
W: Well, and you say, buying used doesn’t just apply to cars, but a lot of other things from furniture to clothes, etc?
M: That’s absolutely true. There’s a great thing called eBay. You can get, you know, you can get cars on eBay, actually you can get homes on eBay. But um, you can buy used everything these days when we say used it’s not vintage, we’re talking about "barely used merchandize", everything from fine furniture to Chanel suits, to, you name it, I mean it’s out there now. The internet has really brought in what’s available. And that can have an effect.
W: Well, that is great, let’s talk about your savings beyond maximizing your 401K at work.
M: Sure, well, saving this is the way you gonna make the biggest leap by far towards that million dollars, and a hypothetical couple, you know, and most of this, by the way, is happening with your 401k. That’s by far the biggest weapon at your disposal to sort of reach this level that we’re talking about here. So you know, we recommend it’s really sacking away 15% of your salary. Ideally, you know, that the maximum for every person is $15,000 but not everybody can do that. But if you just sack away 15% in all hypothetical couple of situation and they did that over 10 years that would amount to $ 397,000 and that’s before any investment gains. That’s just in the contributions alone, so that’s significant.
W: All right, that’s very encouraging, Leigh Gallagher, senior editor of Smart Money magazine, thanks so much.