Each spring, many of us perform a ritual of spring cleaning, hauling out the junk in the recesses of our closets or garages and making some hard choices about what to keep and what to throw away. This spring, do some “financial spring cleaning.” Trash the hidden spending that lurks in corners on autopilot and is never analyzed. Haul out all your hidden spending into the light of day, give it an airing and decide whether you can throw it in the trash.
Evaluate hefty recurring expenses:
You can easily spend $400 to $500 per month on these expenses. Take radical action and cancel everything if you haven’t used it in the last two weeks. Take radical action even on “essentials” like cable TV and mobile phones by downgrading to a lower plan. Try living without them for a month and then add back if you find you absolutely can’t live without it. Many people find they can live with a lower level of service.
Get new quotes, ask for lower rates. While you’re doing your financial cleaning, take a look at what you’re spending on:
Consider switching to a higher deductible on your auto or property insurance. At the very least, call two or three other companies to comparison shop. When open enrollment comes around, evaluate your health insurance by looking at your employee contribution toward your insurance and consider whether you’re in the right plan.
Look for other hidden expenses in your budget. It’s a good time to evaluate things like childcare, housecleaning, lawn care and other recurring service providers. Ask for lower rates, find different providers or do the work yourself.
By pulling your hidden expenses to light at least once a year, you’ll address a major source of your spending and you’ll feel less pressure to scrounge for 10 cent off coupons.
Ah, you can almost smell that fresh scent of clean finances.