Today, I want to talk about all of the little things that hijack budgets and financial planning to contribute to unbalanced finances. Not all of these tips will apply to everyone, but hopefully even finding one or two will help make a bit more wiggle room!
Sometimes the little things get overlooked because they seem so insignificant, but it can be shocking how quickly they add up. My examples below can fly under the financial radar but even just catching or changing one thing in each area could save you $5665 on average! My entire financial attitude hinges on the “little things” and I truly believe that “nickle and diming” is often more of an issue than bigger spends.
|Looking for Fast Food by Marco Monetti|
1. On-the-go Treats
OK, I hate when these types of lists contain the tip to cut out your daily $3.50 coffee — as if that wasn’t obvious enough! But while the average budget-savvy person might already be making their coffee at home, there are other, cheaper snacks that can seem more justifiable.
This tip refers to everything from items on the “Value Menu” from a fast food drive-thru, to portable snacks from the grocery store. My personal guilty pleasure is a junior chicken sandwich and a small fry at $2.94 after taxes; at the time it can seem like a really cheap “meal,” but I can make something directly comparative for about 75 cents at home, or make something even healthier for less! Maybe your personal treats are healthy bars, prepackaged frozen lunches, or even turkey bites and jerky (for all you Paleo eaters); I’ll even assume that you’re buying these items in bulk to cut costs already. Granola bars from Costco range from 33 cents (Nature Valley) to 93 cents (Cliff), Lean Cuisines can go on sale for as little as $1 sometimes (though they are usually closer to $3), and my own preferred turkey pepperettes average 50 cents a stick.
Having just two Lean Cuisines and one value meal per week (minus a drink), plus a daily granola bar and pepperette adds up to $27.71 per week. That’s $1440.84 in one year!
If you’re having a Lean Cuisine every weekday, two daily granola bars and pepperettes, and one value meal per week (minus a drink) that adds up to $36.65 per week, $1905.62 per year! And that’s assuming you get the Lean Cuisines on sale half of the time! Making comparable (or better!) treats and individual-serving meals at home is definitely worth the time investment when you look at the savings.
2. Late Fees
It takes less than a minute to make a call or log onto an internet account and renew a rental; bill late fees can be anywhere from $10 to $50 (plus have a negative impact on credit histories); and not to mention, there are often early-bird discounts or interest-free periods when things are paid promptly.
Its hard to calculate the savings with this one, but say your credit card bill is due two days before you can pay the whole amount — paying even the minimum payment on time can save you not only the $40 in late fees (the current average), but credit card companies often reward savvy customers with perks or larger credit limits. Being late by two days with just five library books or movies can add up to $10 in late fees. Some companies make frequently late bill payers put a deposit down, which can be anywhere from $100 too $500, depending on the service.
Some banks have no-penalty overdraft protection for qualifying customers, which has a usage fee of anywhere from $5-25/month but doesn’t negatively effect your credit history. If you can ensure that you will have the overdraft repaid by the end of the calendar month, it might be worth looking into this service to avoid being late on other bills if your issue is purely timing (when the bills are due vs. when you are paid). However, staying in overdraft can sometimes negatively effect your score, so know your bank’s policies, and know what you’re capable of repaying.
Avoiding just one late fee (whether from a bill or the library) or banking charge per month can save an average of $25/month, or $300/year. Avoiding multiple late fees, or having to put down deposits results in even bigger savings.
|Photo by Gordon Mei|
3. Service Add-ons
This is such a sneaky cost, but it can majorly add up when you look at all of the services that you purchase in a year. Looking at one of the major telephone companies, basic packages can start from about $35/month for just phone service — not including any additional features. But if you need texting capabilities, occasional long-distance, call display, voicemail, additional daytime usage, or data, adding these features on can quickly add up to $104! Not to mention these “basic” plans often require you to purchase your phone outright, anywhere from $50 to $500.
Take your time shopping around and asking questions if you can customize a plan slightly. Don’t be afraid to walk away or let companies know that you’re talking to their competition (even if you aren’t); even if you are already “locked in” to a plan, most companies will renegotiate with valued customers, especially if they are afraid to lose them. But most importantly, know which services you actually need and which are just “nice to have.” I.E., data is convenient, but opting to only use your smartphone when there is access to WiFi can save $15-45/month or $203-610/year after taxes.
I recently had to renew my phone plan and the individual services that I was looking at added up to about $200; the plan that bundled these and took into account my nearly decade-long customer history came to about $103/month, but that included the new iPhone 5 and 3G of data. By questioning the need for the newest version of the iPhone and honestly evaluating my data usage (a site like this can help), I was able to bring that cost down to $62/month, and my plan has unlimited national calling, so I don’t need a landline or additional coverage (and if I do need to make an international call, I can use Google Chat or buy a calling card). My dad’s phone, which lacks data or texting, comes in at $38/month. Ensuring that your new plan includes new phones can also allow you to sell off your old phone and avoid paying for a full-price replacement if your phone will not live through the remainder of your plan term (darn that planned obsolescence).
The savings between the two phones by questioning which perks we needed and ensuring we received new phones added up to $179/month in savings, or $2155/year. Not to mention the cable, internet, satellite, car, and other services.
|Bowling Shoes by Eric Grossnickle|
4. Activity Fees
Okay, so you’re already going to the bowling alley on cheap nights, swimming on a bulk pass, or otherwise saving money on your leisure activities. But if you’re borrowing the alley’s shoes, or using the locker or towel rentals, those fees can cost you $2-3/person per visit. If you are just doing one activity per week, that’s an average of $130/year per person.
For a family of four, buying used bowling shoes rather than renting can save $390/year.
As for the locker, see if there is a member price for the year rather than a per-use fee. Or, if your pool is in a safe area, leave what you can at home and lock any other valuables in the trunk of your car. And don’t even get me started on that towel fee… Savings $624/year without the locker, or $589/year with the cheapest locker option.
5. Read Your Bills
This might seem out of sync with the other items on this list, but I cannot tell you the number of times I’ve found errors on mine or friends’ bills! Everything from restaurant bills to phone bills to electricity bills can contain small errors that majorly impact your budget. If you find an error, call immediately to ensure that it is rectified, and once it is make sure that the company ALSO gives you a goodwill credit for the inconvenience and “cost of your time.” Don’t be afraid to look over past bills, good companies will still make good on past mistakes.
Also, make sure that refunds or credits are properly applied to bank accounts or credit cards, and that online purchases are only billed once. I had some double billings around Christmas that had I not caught would have cost me over $1400! This happens frequently if you use a Visa Debit card or do any international ordering. Catching even one $15 error per month will save you $180/year.
Assuming one big annual mistake and smaller monthly mistakes, reading your bills can save you upwards of $680/year. In the past six months, I’ve caught over $1600 in mistakes!
(NOTE: And, depending on your payroll department, it is also a good idea to double-check your pay stubs to ensure that everything is there and tax deductions were done appropriately for your income level. Many companies deduct the same percentage for all employees, regardless of income level, and sometimes overtime or bonus shifts are missed.)
I hope these suggestions can save you some money this month. Don’t feel guilty if you’ve been taken in on any of these expenses in the past; knowledge is power and what counts is what you do from here on out with the information!
I would love to hear from you! What small things have you tried that have led to big savings?