Credit cards can be a double-edged sword if you’re not careful about how you use them. Sure, they’re convenient but it comes at a price if you’re paying interest on the things you buy. Wouldn’t it be smarter if you could spend to save instead?

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There’s an old saying that it takes money to make money and while it’s usually associated with investing or starting a business, it can also be applied to the art of saving. When you have more money in the bank, you’re in a better position to avoid using credit and racking up interest. Not only that, but you have more leeway when it comes to making big ticket purchases that can put more money back in your pocket in the long run. If you’re trying to build a more solid financial foundation, knowing when you should spend to save can go a long way towards boosting your bottom line. Here are four ways to wisely spend your dough so you can save money in the long run.

1. Choose cash for a car

Making payments on a car for three, five or even seven years really doesn’t seem all that logical, especially when you factor in the interest and the depreciation, but it’s something people seem to be all too willing to do. By the time you finally get it paid off, you’ve probably paid more than the car is actually worth. If it ends up needing a major repair, you may find yourself back at square one, cruising the car lots again and signing on the dotted line for an expensive loan.

If you can swing it, paying cash for a vehicle effectively saves you all the money you would have spent on interest. Unless you’re really rolling in the dough, you may have to settle for an older model instead of your dream car but choosing something reliable can keep your maintenance and repair costs to a minimum. If you sock away the money you would have spent on a car payment, replenishing your savings shouldn’t take long at all.

If you’re in the market for a used car, read up on how to avoid getting duped, and know the Lemon Laws in your state.

2. Knock out your mortgage faster

Buying a home is a major financial milestone, especially in today’s economy where lending restrictions are tighter than ever. Thinking of a home as an investment is really a long-term strategy since it can take several years before you recoup your initial outlay of cash. The higher the interest rate, and the longer your loan term, the more money you’re shelling out that you could be saving for your other financial goals.

Refinancing your home to a lower rate can help you to pay off the debt faster and free up more room in your budget. Switching from a 30-year term to a 15-year term will cost you more over the short term since your payments will be higher, but you’ll be mortgage-free in much less time. It also drastically cuts down on the amount of money you’re throwing away on interest.

If you’re not in a position to refinance, you can still save yourself some money by prepaying the mortgage. By putting as much money as possible to the principal, you’re reducing the amount you’ll pay in interest over the life of the loan. Even making one or two extra payments a year can shave thousands of dollars off what you owe.

3. Get energy efficient

Turning off the lights and cutting back on how much water you’re using are no-brainers if you’re trying to lower your utility bills, but you can make some even deeper cuts in your budget if you’re willing to spend a little more. Trading out your old refrigerator or range for a more energy-efficient model may require an investment of a few thousand dollars but you should see a big payoff in the form of shrinking energy costs.

If your philosophy is go big or go home, installing a geothermal, solar or wind energy system can drop your utility bills to practically nil. Depending on the type of system involved and the size of your home, installation can run you upwards of $20,000 but they essentially pay for themselves over the course of a lifetime. Not only that, but Uncle Sam is offering a generous tax credit equaling 30 percent of the cost through 2016. You’ll be parting with a nice chunk of change at the outset but it’s a savings win if you’re looking at the bigger picture.

4. Pay bills up front

Some bills (like utilities) you have to pay every month, but there are others that may offer a little more flexibility. With things like car insurance or homeowners insurance, you typically have the option of making payments on a monthly, quarterly or annual basis. Breaking down the total into smaller amounts means you don’t have to fork over a big wad of cash all at once but you’re likely being charged a fee for the convenience.

Even if it’s just a few dollars a month, that’s more money that could be staying in your bank account. Paying irregular bills all at once instead of little by little can add up to an extra few hundred dollars you’re saying throughout the year. Some of the ways you can spend to save may not be as obvious but all it takes is a little creativity to see where you can get more mileage out of every penny.

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