Want to save some money today? Here are five simple ways you can spend a few hours today to save some cash.

Small changes can lead to big wins. What small changes have you implemented that are saving you money?

In far too many cases, we wrongly conclude that an event or action is the cause of a result, rather than a mere influence or related occurrence. When analyzing our finances, and indeed our lives, it is important to consider whether causality exists between the event and the result.

A Non-Financial Example:

A recent study compared heart attack victims to healthy volunteers and found the heart patients had a higher number of bacteria in their mouths. Many ne ws outlets picked up this story under headlines like "Brush your teeth, it could prevent a heart attack." But is that really what the research showed? Good oral health has been shown to have many other positive benefits, so it seems to be a reasonable conclusion. Causality may indeed exist between bacteria in the mouth and heart attack risk, but an equally plausible explanation is that someone who doesn’t take care of his mouth also doesn’t take care of the rest of his body. If that’s the case, brushing your teeth won’t prevent a heart attack.

A Financial Example:

If you were to learn that most people filing for bankruptcy have credit cards, you might wrongly conclude that credit cards cause bankruptcy. If that conclusion led you to never have a credit card, you could miss out on the many benefits that using a credit card responsibly can bring, such as a longer credit history, rewards points, and payment flexibility. Irresponsible use of credit may certainly be a contributing factor (or even a cause) of many bankruptcies, but simply having a card is not.

Conclusions drawn from a result back to a potential cause often miss the critical element of causality. Why does causality matter? Without it, you may be focusing your efforts in the wrong place or missing out on great opportunities.

Have you ever taken an action that turned out to have no effect on the desired result?

In the previous posts in this series, we covered why it is a bad idea to identify who you are as a person with how much money you have and how to take the first steps to free yourself from this problem. This post continues to explore these issues.

Separating how you view yourself from how much money you have or earn will lead to the following:

1. An understanding that money is a tool. Just like any other tool that you can use to accomplish any task, money is also a tool. It is a very powerful and very flexible tool, but still a tool. It is not you. You are not money. You have the tool, meaning you have money and you can use that tool to get more money, or you can squander it and lose some of the power that the money tool has. It’s up to you.

   Knowing that money is a tool separate from who you are, and that you are in full control over it, should give you a certain sense of freedom in knowing that you can use this tool to earn more money and accomplish your goals without having the money control you and your actions.

2. An ability to think for yourself and make the best decisions for yourself. You will no longer have to rely on personal finance “experts” to tell you what to do with your money. Now you will see money as not a part of yourself, but as something that you can use to invest for the future and improve your life.
3. An awareness that money problems become objective problems and will not overwhelm you. Now, if you have a money problem, you can think about the problem just like any other, objectively and on paper, and come to a conclusion about how to deal with it. It will no longer feel like you’re “drowning” or being overwhelmed by financial decisions.

Credit card borrowing declined in February by the largest dollar amount in recorded history. It fell at an annual rate of $7.8 billion (9.7%).

It’s interesting to see consumers turning away from credit cards during difficult financial times. In the previous report, consumer borrowing rose at an $8.1 billion annual rate for January. At the time, analysts cited the increasing need for credit to pay for things like regular bills as more and more people faced job loss.

It’s possible that the latest decline is partially a result of credit being maxed out for many people who are just as in need of more help, but simply don’t have any more credit available to them. Auto and other personal loans in February rose slightly, at a $313 million annual rate, or 0.23 percent, which adds some validation to this theory. Another likely cause is that consumers are finally starting to get serious about cutting excess and waste from their spending out of necessity.

Consumer spending has an interesting relationship with the economy as a whole. In general, slow economies cause consumers to spend less even though increased spending would aid the recovery. A better scenario is when consumers continue to spend, but do so in more responsible ways, such as relying less on credit cards. By spending while living more within their means, consumers strengthen their own personal financial positions, while aiding in the economic recovery at the same time.

With such large changes in consumer borrowing from January to February, it will be very interesting to see what the March numbers report when they are released this month. The February numbers may be a temporary anomaly, but for the time being they certainly seem to be an encouraging sign that consumers are starting to take responsible actions.

Have you been relying on your credit cards more or less in the past few months?

Renting and Buying Property

Everyone knows that all clouds have a silver lining - the thundering rainstorms last night in Rio De Janiero, where I'm living, made the streets extremely clean this morning So how about the financial crisis? Does something this harsh, this horrible, and this painful also have its own silver lining? Definitely.

I've written earlier about how some expenses are suddenly cheap, such as travel or starting your own business. How else can you take advantage of this crisis? For one thing, now might be the time to buy a house or rent an apartment. Why? Because prices have gone way down. Prices in San Francisco, for example, have decreased over 4% from their peak in 2008, according to an article from sfgate.com. Currently at an average of $1,556/month, rents have decreased as occupancy rates have fallen. Economists at IHS Global Insight predict that housing prices might even reach 50% of their top prices, according to the Orange County Register.

So what can you do to take advantage of this? Follow these steps:

1. Figure out what you are paying for your rent.
2. Look up similar rental rates in your area. Check Zillow.com to look at real estate prices near you.
3. Are you overpaying? If so, talk to your landlord and try to negotiate a lower price. If not, consider moving out at the end of your lease. You might be able to find a better place for a cheaper price.

Would you consider moving to a new home or apartment if prices were cheaper? Are you overpaying?