Here are a few ways to fatten your wallet each month and reduce some monthly annuity costs:
Roku – Not sure about you, but one of the bills I despise paying the most is my monthly cable bill. Our household cable bill for the right to watch television laced with advertising is just about $100 per month. If you have a good wireless internet connection in the house, you might take a look at Roku (or other Internet TV providers). A Roku box is a little piece of hardware that streams entertainment to your television and claims to have access to over 750 channels. Some of these channels you have to pay for, but many are free. That is correct, after the initial cost of the hardware, about $65, you can get high definition television for free. This is definitely a different television viewing experience as Roku does not stream live television and trying to watch the Bruins is a difficult task. However, there is plenty of content available to keep you entertained at a much cheaper price. Add a subscription to Netflix or Amazon Prime, which run about $8 / month, which is much cheaper than cable, and there are plenty of television series and movies to watch commercial free. We have cut our household cable service down to a minimum and stream most of our entertainment via our Roku box.
Coffee makers – About a year and a half ago, my wife brought home a Keurig coffee maker. At first I resisted using it, but my love /addiction of coffee and its convenience were difficult to pass up. Soon, I became a rabid user. However, the cost of single serve coffee pods is a bit on the inflated side. Even when buying in bulk, the cost of coffee using single serve pods is about $0.75 per cup. Two or three cups a day, multiplied by two people and you can be spending almost $100 per month on single serve coffee pods. Finally I made a change. I bought a Hamilton Beach Single Serve Coffee Maker for $59 where you use regular coffee grounds without the need for pods or any special filters. By eliminating the single serve pods and just using regular ground coffee, my cost is about $.05 per cup. I have to say using this device is almost as convenient as using my trusty Keurig and makes a pretty good cup of coffee. It takes about three minutes and my coffee is ready. In addition to the monthly price savings, I placing a lot less plastic in the local landfill.
Insurance deductible – I can not recall a time in my life where I made a property insurance claim of any kind (knock on wood). If your claim history for home and auto is pretty low, then you might consider increasing your deductibles on your home and or auto policies. By increasing the deductible from say $500 to $1,000, your premiums will decline. The increased deductible reduces the risk for the insurance company and pushes more of that potential risk on to me. But if my future property losses are similar to my recent past, then this one will pay off.
Refinance the Mortgage – Most people have refinanced their mortgage already, but there is a pretty large number of folks that have not been able to take advantage of the low interest rates environment because their homes have been underwater. However, home values and appraisals have been on the rise of late and many of those underwater homes might be back on solid footing. It is certainly worth taking a look as you can save a lot more than $50 / month with this one. By refinancing over the last few years, my wife and I are paying about $600 less in monthly interest expense.
Private Mortgage Insurance (PMI) – Many people must pay PMI when they have less than 20% equity in the value of the home, i.e. they put less than 20% down on the home. However, once you pay down enough of your mortgage such that you have 20% equity in your home, your PMI requirement should cease. The lender will not typically end the PMI requirement, you will have to call them and inform them that it is time to discontinue the policy.
Dining out – Brown bagging your lunch a couple of times per week can easily save you $50 / month. As a bonus to the cash savings, you will likely save yourself a significant amount of calories as well.
Increase your 401(k) / IRA Contribution – By contributing another $200 or so per month into your 401(k) plan or Individual Retirement Account, you can probably save yourself about $50 in federal and state income taxes. Only about 5 percent of Americans contribute the maximum allowable amount to their 401(k) plan, so many can take advantage of this one.
Land Phone Line – It seems a lot easier to maintain just one phone number via your cell phone than have a couple of different phone numbers. Why not just move exclusively to the cell phone and ditch the land line. Verizon’s bundled billing practice is obviously one to confuse so you can not find the real cost of what you are paying for the land line, but you can be sure that the cost of the land line is real. Worth taking a look once your contract expires.
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