Wednesday, July 2, 2008

Savings - My Second Favorite Way to Make More Money

It seems obvious, but occasionally I need to be reminded of the easiest way to have more money each month. It's simple:

Spend Less.

Spending less is something we can do every day - not buying that King Sized Snickers Bar (even though it was on sale and I've had a really rotten day 48 hours and, dang it, I wanted one.*) or regularly looking at the big, fixed bills and seeing if those can be affected.

A lot of blogs talk about calling up credit card companies and asking them for better rates. I have never had one lick of luck dealing with credit card companies, so I keep my rates low by having good credit. I did, however, have luck with my mortgage. Having my taxes drop was just lucky a windfall, but paying the escrow shortage was by choice. All together it means that each month I pay $80 less - which is more money in my bank account.

This month I tackled my insurance. (Ok, I actually did the work last month, but my rates change on the 7th so I am calling it part of July's plan.) As I mentioned earlier, I have been working with my brother-in-law to drop my insurance rates. By making some changes to my policies (and paying some of them up front) I was able to cut the costs down by $31.44 a month. With this new system, I am not funding my life insurance plan as well as I would like to, but this plan keeps everything in place and me secured until times are a little less tight. I will re-evaluate these decisions on a quarterly basis to make sure they are doing what I need them to do, and as soon as I can change things around, I will.

By far the best thing I did though, is realize that I had a really bad spending habit when it came to my emergency funds. I was not keeping my checking account at a comfortable level and then having to use my emergency funds to cover it - it made for a mess! Especially since I wasn't doing a good job of replacing the funds. Since that light bulb moment I have changed my pattern of behavior - now when I get reimbursement checks, they are are used as reimbursement checks and the money goes straight back into checking. I noticed the difference in June! My checking account seemed much, much healthier - and I was able to fund my emergency savings with one check and then stop monthly payments into it. Of course now that I am having water heater problems, I may have to dip into it, but that is what it is there for - not for frittering away, like I was doing.

Total monthly savings - $161.44

*Yes, I bought it anyway. And it was gooooooood.

No comments: