The third installment of a weekly series on budgeting.
Last time we talked about budgeting the Essentials. After looking it over, we’re going to take a little longer to talk about this before moving on to non-essential non-variable expenses. There was one expense that we left out: Health Insurance. You may find that this comes out of your paycheck before you ever see it, or you may have state-funded insurance. If not, you may be paying a premium for it. We consider Health Insurance as an Essential. After all, if you don’t have your health, you haven’t got anything.
The homework last time was to write all of the Essentials out and subtract them from your income to see how much you are left over with. Some of you may have found that there is nothing left, or maybe less than nothing. This means it’s time to see where you can cut back.
Start with the largest bill on your Essentials list that fluctuates. We’re going to talk about the big ones that you can impact, starting with Electricity/Gas.
When you think about electricity, and how to cut costs, you probably think about the basic way of turning a light off when you leave a room. This is a good start, but we’re going to take this a step further. If there is a window in a room, open the curtains and/or blinds during hours of daylight instead of turning on the light. If you’re only using your light bulbs when it’s dark out, they will last longer and you’ll be using that much less energy. Make sure all electronics are turned off when not in use (computers, game consoles, the TV, etc.). During vacations, and sometimes at night, unplug some of the large appliances. TVs, computers, stoves (if electric), and washers and dryers still draw electricity, even when they’re not in use.
In the mornings, when the temperature outside is typically cooler than you would keep your house, turn off the AC and open some windows. In the wintertime, you will probably be able to stand turning off the heater during the afternoon, when temperatures usually peak. When everyone (except the pets) are out of the house, turn the thermostat closer to the outside temperature for that season (i.e. Summer up to 80 and Winter down to 60), 80 still feels cool when it’s 100+, and 60 is still warm when it’s 50. At night, and during vacations, unplug some of the large appliances. TVs, computers, stoves (if electric), and washers and dryers still draw electricity, even when they’re not in use.
Auto Insurance is another big bill on most lists. We’re sure you love the company you’re with, but the budget-savvy person shops around for their insurance every six months. If you’ve never done this, wait until a month or so before your current policy is up. This way you don’t have to worry about paying two insurance premiums at the same time (most companies will let you buy a policy within a month of it going into effect), and you can let your current policy run out instead of having to deal with any fees that may arise from breaking your policy early. If you are switching, be sure to let your current company know so that they don’t re-start your policy. You can get free quotes from most major companies by calling or going on-line. Check out USAA (if you qualify), Geico, Esurance, Nationwide, Progressive, Farmers, State Farm, and any others that you can think of. Remember that you can get a discount for bundling vehicles under one policy, or bundling your renter’s insurance with your auto insurance. Some companies will even price-match their competitors to keep your business. So, if you’re happy with your current insurance company, but find that they are not the best price, call them to see if they will price match. Not only does it save you money, but you get to stay with a company that you know and trust.
Published in: Apartment Living