In order to make ends meet and save money for extras, you have to treat the family budget like a family business. That means keeping an eye on your finances month after month and regularly evaluating ways you can cut costs. Believe it or not, there are a number of things you can do relatively quickly to reduce expenses and continue to reap the rewards over the long-term.
Rack up significant savings over time by taking an afternoon to thoroughly assess your budget and make a few adjustments.
Monthly Expense: Utilities
The Fix: Find a Provider With Better Rates
More and more areas across the U.S. are transitioning to deregulated energy markets. A deregulated energy market is one where locals can choose their own provider rather than having to use a supplier that’s selected by the city. This is great news for budget-conscious families since you can get electricity for a lot less – if you take the time to research.
Folks that live in deregulated energy markets can go online, compare available plans and choose power providers with the best rates. Studies in Texas have shown that consumers that fail to comparison shop end up paying more than those that research rates before selecting a provider.
Monthly Expense: Television, Internet and Phone
The Fix: Bundle Services Together
Some will say that television and Internet service is a luxury and they’d be right. But if you work from home it could be a real necessity. Not to mention that TV and Internet entertainment is a lot more affordable than going out. If it’s been a while since you compared your current plan to available offers now is the time to see what else is out there.
One of the easiest ways to get the best deals possible is bundling the services together with a single provider. Typically, providers offer special rates when customers combine television, Internet and/or phone service. Even if you don’t want or use a home phone it could actually be more cost effective to bundle all three together. Another bonus of bundling is it makes bill payments easier to manage.
Monthly Expense: Insurance
The Fix: Keep Your Provider Up-to-Date
Insurance is an intangible expense. Each month you’re actually paying for peace of mind that you’re financially covered if something were to happen. You pay the bill and pray you don’t have to make a claim.
Getting insurance premiums reduced by as much as 25% could be as simple as updating your information. For example, installing a home security system can lower your home insurance premium. Other updates that can get your insurance premiums reduced include:
- · Educational attainment
- · Going an extended period with making a claim
- · Improvements on your credit score
- · Adding storm shutters
- · Installing a interior sprinkler system
- · Improving the electrical system
- · Completing a drivers course
- · Moving to a gated community
- · Retiring at age 55
- · Using gas and water sensors around the house
- · Installing impact resistant roofing
Review your insurance policies at least once a year to make sure they’re still suited for your circumstances and as affordable as possible. If you use numerous insurance providers you may also want to consider bundling your policies together with one company.
Monthly Expense: Late Fees
The Fix: Set Up Auto Payments
Late fees have direct and indirect costs. You’ll be hit with an additional expense right off the bat, but your credit score could also suffer. When that’s the case it makes borrowing money even more expensive because you can’t get the best interest rates.
The easy fix for these problems is to put bills on auto pay. Almost every service provider and credit card company lets customers create an online account where they can include their bank’s information. Once the bank information is verified the provider can then automatically withdraw the payments. Bill management is much easier and you won’t have to worry about late fees.
Monthly Expense: Savings
The Fix: Use Auto-Debit Features
It’s a lot easier to save money if it’s never in your checking account. Ask your employer if the payroll department can set up an auto-debit so a small chunk of each paycheck goes directly to a savings account.
Another way to save without really trying is to use a roll over option. Many debit card providers will allow you to round a purchase up to the next dollar and put the difference in a savings account. It’s basically a virtual penny jar that’s even easier since it’s automatic.
On the subject of bundling TV and internet, this is a ploy devised by the cable companies to dissuade “cable cutters.” Many of these cord cutters (like myself) are resorting to independent ISPs and opting for affordable streaming services in place of cable television, thus saving massive amounts of money which really accumulate over time. If you really want to take the fiscally friendly route, I would do away with the bundles and go for the streaming.
TV and Phone and internet providers in Canada are controlled by the CRTC, which means we have less competition. One thing I learned is, rates have come down over recent years, but unless you call and ask for a cheaper rate – you don’t receive the reduction. I phone every 6 months and ask if I am on the best plan for my usage. There have been a number of times this has resulted in a lower bill.