There are two ways to boost your personal cash flow — increase your income or reduce your spending. The former can be a challenge but the latter doesn’t have to be.

The headline of the above video — “Cut Your Spending By $500 Per Month” — is somewhat sensational but the advice given during the video is spot-on.

From NBC’s The Today Show, the 5-minute piece offers a half-dozen ways to reduce your cash outflows each month, including:

• How to negotiate a lower credit card interest rate
• Why it’s important to go grocery shopping with “a list”
• How to “time” certain purchases like tires, linens, and clothing

It also covers saving money on a family pet.

It’s often easier to save money than to make money. This video shows how easy it can be.

In what’s becoming a regular occurrence, housing data blew away economists expectations Tuesday.

As reported by the National Association of Realtors®, the Pending Home Sales Index posted its 6th consecutive monthly gain in July.

After a meteoric rise that started in January, the index is now at its highest levels in more than 2 years.

A “pending home sale” is a home that is under contract to sell, but not yet closed.  It’s not the same as an actual home sold, but data shows that nearly 80% of homes under contract close within 2 months and many more close in months 3 and 4.

Home buyers — take note.  When the Pending Home Sales Index is rising, it means that market activity has picked up.  This can lead to any one, or a combination, of the following:

1. Multiple-offer situations
2. Reduced negotiation leverage over sellers
3. Higher home sale prices with fewer concessions

So, consider yourself alerted.  If you’re buying a home in the next several months, expect the recent run in Pending Sales to lead to a run in closed sales, too.  That should lead home prices higher in most markets.

Indeed, we’re already seeing it.  Case-Shiller says prices are on the upswing.

In a bit of good news for the economy, Consumer Sentiment fell to 4-month lows in August.  The drop wasn’t “good news”, per se, but because it wasn’t nearly as large as economists expected, Wall Street cheered it.

The index, jointly published by the University of Michigan and Reuters, measures how Americans feel about their situation today, and how they envision it six months in the future.

Since bottoming 5 months ago, consumer sentiment has added more than 10 points.

Rising Consumer Sentiment figures can foreshadow economic growth because confident consumers are more apt to spend money on big-ticket items including appliances, automobiles, and, of course, new homes.

The recent run of sentiment data is one more reason to believe a full economic recovery is underway.

That said, the Consumer Sentiment survey has its flaws.

For one, the survey’s sample set includes just 500 households nationwide and that’s not a true cross-section of America. And second, just because people feel more confident about their finances doesn’t always mean they’ll spend more money — sometimes, they choose to save.

For now, though, stronger-than-expected sentiment data should help propel both retail sales and home sales volume through the fall season, and may even create some inflationary pressure on the economy.

If these levels are sustained, expect that mortgage rates will rise.

Mortgage markets were flat last week overall, although mortgage rates were somewhat volatile from day-to-day.

For rate shoppers, the best pricing was available Monday morning and Friday afternoon — everything in between was slightly elevated.

It’s the second consecutive week in which rates finished unchanged.

There was a string of good news last week about the economy, led by housing.  New Home Sales, Existing Home Sales, and the Case-Shiller Index all surprised to the high-side and consumer confidence numbers came in higher-than-expected, too.

In prior weeks, strong data like this would have caused mortgage rates to rise.  Last week, however, it didn’t.  Mostly because foreign demand for mortgage-backed bonds has remained strong.

This week, there’s only one major data release and its timing may prove to be problematic.

Friday, the Bureau of Labor Statistics releases the August Non-Farm Payrolls report.  With housing’s rebound seemingly underway, the jobs report takes on added significance.  Joblessness can undermine consumer confidence and spending and cause harm to the recovering U.S. economy.

This is one reason why rate shoppers should be cautious toward the end of the week — the jobs report will move markets.  The other reason to be cautious is because Friday is the day before Labor Day and Wall Street will be short-staffed.

Fewer traders means more volatility — if rates start to pop, they’ll really pop.

The number of homes under contract to sell rose in June for the fifth straight month.It’s the Pending Home Sales Index’s longest winning streak since 2003 and another piece of evidence that the housing market may be rebounding.

• The supply of new homes is falling
• The supply of existing homes is falling
• The Case-Shiller Index showed home value increases in many of its markets

Separately, the data is interesting. All together, it paints the portrait of a recovery.

That said, we can’t forget that the Pending Home Sales Index is somewhat unique versus other real estate reports.  Whereas data on existing and new home sales measures closed transactions, the Pending Home Sales Index only measures intent to buy.

Just because a home goes under contract, in other words, doesn’t mean that it actually will sell.

Purchase transactions can fall apart for a multitude of reasons including, but not limited to, buyer-seller disputes, failed home inspections, and an inability to secure mortgage financing.  The Pending Home Sales Index doesn’t account for these types of issues.

In general, though, as the number of homes under contract increases, Existing Home Sales increase, too — usually on a 2-month lag.  Home sale data should remain strong through early-Fall, at least.

For active home buyers, be conscious of the fact that that more home sales plus falling home supplies leads to higher home values.  If you’re looking for a bargain, the longer you wait, the less likely you may be to find it.

Where does the money go?If you’re like most U.S. consumers, more than half of it goes to housing and transportation costs.

According to the government’s most recent Consumer Expenditure Survey, spending patterns are little changed from years prior.

More money is spent on entertainment and less money is spent on dining out.  Beyond that, the figures are somewhat static.

Meanwhile, using on the survey’s industry-by-industry breakdown, we can see how monthly housing payments and daily commuting costs impact a household’s budget.

For the budget-conscious, going out less often and bargain-shopping can help pad the bottom line, but not as much as living in a less expensive home or moving closer to work.

Even a refinance into lower rates can make a difference.

Mortgage markets improved last week despite a series of volatile trading sessions.A combination of weaker-than-expected economic data and massive-sized Treasury auctions kept investors guessing and mortgage rates moving.

• Weak data nudged rates lower
• Treasury auctions pushed rates up

By Friday, however, momentum was in favor of lower rates and that’s how the week finished up — slightly more favorable overall.

It’s the second consecutive week in which rates fell.

This week, markets will digest a host of new data.  Rate shoppers can expect the volatility to continue.

Monday afternoon, Auto and Truck Sales data is released.  We normally don’t track this report, but because of the auto industry’s role in the economy right now, strong numbers should lead to a mortgage bond sell-off, pushing mortgage rates higher.

Then, Tuesday, the Personal Income and Personal Spending report is released as well as the Pending Home Sales Index.  Again, strength in the numbers should result in higher mortgage rates.

Thursday, Initial Jobless Claims will get the market’s attention.  The data has been trending lower over the past two months and, last week, the rolling, 4-week average posted its lowest mark since January.  A reversal in the trend would likely boost the mortgage markets, helping rates to fall.

And, Friday, the jobs report is due.

With unemployment close to 10 percent nationwide and more than 3 million jobs lost this year, investors will respond to “less weak” data with enthusiasm — a bad result for rate shoppers.  No matter what the data says, it’s sure to move markets.

Once again, the housing market is showing that its worst days may be over.According to the Census Bureau, the number of new homes sold in June leapt by 11 percent from the month prior.  It stands as the biggest one-month jump in 8 years.

A “new home sale” is when a home in any stage of construction — not yet started, under construction, or already completed — goes under contract, often with a builder.  It’s the opposite of an “existing home sale”.

In addition to surging sales, the monthly supply of new homes fell to its lowest level in 11 years.

Because home values are based on the relative supply and demand for a particular home in a particular area, anytime that demand for homes grows faster than supply, we would expect prices to rise.

Indeed, that’s what we’ve been seeing.

The combination of low interest rates, seller-paid incentives and a first-time home buyer tax credit is bringing buyers into the market faster than new supply can come online.  It’s one reason why home prices have stopped falling across many parts of the country.

It’s also why home buyers may find it tougher to get “a good deal” in real estate later this year and into 2010.  If demand stays high and supplies fall further, sellers should regain the upper-hand in contract negotiations.

Home values around the country appear to be leveling.The Federal Housing Finance Agency’s latest Home Price Index report shows values up by nearly 1 percent in May versus the month prior.

Since peaking in April 2007, values remain off by 11 percent nationwide.

The FHFA Home Price Index is an interesting metric.  Different from the Case-Shiller Index which collects data from just 20 U.S. markets, the Home Price Index reflects every U.S. home that backs a mortgage sold to Fannie Mae and Freddie Mac.

In this sense, the FHFA Home Price Index is more “national” than the Case-Shiller Index but the HPI has its flaws, too.

The House Price Index specifically excludes from its measurements the sales price on any home purchase with any of following traits:

1. Is new home construction
2. Is a multi-unit property
3. Is financed by an entity other than Fannie Mae or Freddie Mac

Because of these exclusions, some analysts say the report is incomplete.  The same could be said of every method of home valuation, however.

Therefore, what’s most important to today’s home buyers and sellers is that each of the “popular” home valuation reports shows similar patterns.  Home prices appear to have stopped falling and may be even starting to recover.

It won’t be for a few years that we’ll be able to look back and point to the exact month that real estate bottomed. Nevertheless, considering how the data has presented as of late, it’s reasonable to think that we’ve already hit it.  Certainly, that’s what the Home Price Index suggests.

For a region-by-region breakdown of the Home Price Index, visit the FHFA website.

Mortgage markets rallied Tuesday while Fed Chairman Ben Bernanke gave his semi-annual testimony to Congress.By the time the day was over, some conforming mortgage rates were down by as much as 0.250 percent.

One of the leading causes for the market rally was Chairman Bernanke revealing an “exit strategy” from its massive market stimulus.

Until Tuesday, the Fed hadn’t gone into much depth about means and methods by which it would unwind its interventions.  In addition to penning a widely-read Op-Ed piece in the Wall Street Journal Tuesday, Bernanke testified to Congress that the Federal Reserve has a viable “exit strategy”.

Wall Street was pleased to hear it.

The specter of long-term inflation has spooked the mortgage markets off-and-on since the start of the year.  It’s one of the reasons why mortgage rates have been so jumpy, and why they crossed 6 percent last month.  Inflation is terrible for mortgage markets.

So, with the fear of inflation subsiding — at least temporarily — mortgage rates sunk Tuesday.

With any bit of luck, momentum will carry rates lower today and through the rest of the week.  But, don’t get greedy.  Mortgage markets are notoriously fickle and one “bad” statement from the Fed Chairman could cause rates to rise right back up.

Bernanke’s complete Tuesday testimony can read online at the Federal Reserve website.