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Optimizing Expenses
Old 08-19-2007, 04:01 AM   #1
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Optimizing Expenses

DW and I have a LBYM approach to spending (although we do not deprive ourselves). But still I can't help but thinks we could be a bit more effective in our expenditures. By that I mean we could get the same products and services and spend less. We are fairly careful when making a new product or service purchase, but we probably scrutinize our ongoing service and product purchase relationships less frequently.

Do you periodically (every few year) look over and compare purchases to optimize the cost of spending to get the same for less. I am speaking in fairly broad terms. Some examples might be. (Cable TV vs Satellite) , (Insurance providers for home, car, etc), (where you shop for groceries), Things you do over and over again.

Note: The Poll is about what you are actually doing now... not what you should or intend to do.

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Old 08-19-2007, 06:35 AM   #2
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I review my general budget against my spending anually, in January or end of December. For insurances, I compare about 2 months before the renewal.

Last year I did a 3 year spending comparison, which was an eye opener.

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Old 08-19-2007, 06:51 AM   #3
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I'm always looking for cheaper options for my bigger expenses. I compare insurance rates every time my renewal comes up (last year my auto insurance, for 4 cars, went from $2,400 to $900 - that was worth an hour or so on the internet). I'm always looking for cheaper broadband and cable providers (no luck yet) and I buy wine by the case to get the 10% discount.

I have just started tracking expenses in more detail, not so much to try and eliminate certain expenses, but more to get a clear idea of where my money goes so I can plan better for retirement.
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Old 08-19-2007, 07:18 AM   #4
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I frequently look for the easiest place to lower my recurring expenses. Sometimes I find new ideas from reading this board. I am already saving $15/mo due to some information I got here. That is real money, in my pocket!!!

So, gang, reading the board can literally PAY....
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Old 08-19-2007, 09:41 AM   #5
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We don't but we should. Frankly, we are about to start examining the budget for leaks, so this type of exercise will be part of the examination. We just haven't progressed year-to-date as much as we'd hoped, planned, so evidently our budget is too "flexible". Going to have to change that if we ever plan to reach out goals.
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Old 08-19-2007, 10:25 AM   #6
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Originally Posted by chinaco View Post
Do you periodically (every few year) look over and compare purchases to optimize the cost of spending to get the same for less.
Most of the killer expenses are the habits & renewals, not the occasional $20 impulse.

We look at all the recurring expenses annually-- especially insurance but also utilities. A thread on this board inspired us to cancel our personal property insurance. Getting quotes from different insurers is much easier, especially GEICO's website. We ditched an expensive mutual fund (1.37% expense ratio) for an ETF at half the price. We compare credit union's CD rates and price Costco against the military commissary & exchanges. We beat the crap out of mortgage refinancings for about three years before we hit the bottom. When home prices were collapsing a decade ago, we challenged our property taxes and reduced them by 25%. We even canceled our newspaper a couple years ago when we realized that we spent more time recycling it than reading it.

Whenever we contemplate a new possession we start watching Craigslist. Buying used lets us spend a lot less money deciding whether we really "need" that laptop or another piece of furniture or an intriguing tchotchke, and it helps us settle on style/size/color. Most of the time we find it after a couple months. Other times it takes one or two tries to find what we like. If we actually strike out on Craigslist and end up going retail, by that point we know exactly what we want.

Our latest project is our water bill-- the sewer company assumes that all the water coming into the house ends up in their sewer pipes and charges accordingly. In our case it's mostly irrigation, but we'll have to pay for a separate water meter to prove it. That means finding a plumber who's willing to waste a day installing it for us (the water company doesn't trust me) instead of making more money plumbing new-home construction...

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Old 08-19-2007, 11:10 AM   #7
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In a haphazard manner.

Occasionally I'll be inspired by something read here and look into it.

A ways back (as a result of a thread here) I realized I was paying ~$100/month for cable and I reduced it to ~$50.

I also was inspired to switch cell phone to 'pay as you go'; now about $10/month (was $25).
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Old 08-19-2007, 11:31 AM   #8
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We check at least every year. Always looking for ways to decrease spending that has no impact on our life. Car insurance - changes in telephone or cable suppliers - low energy appliances are just a few changes we've made and they don't show up except on the bottom line.

Other time we make changes that do impact our lives (changes in our cable programming for example) when we feel the savings would give more satifaction saved or spent on other things.
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Old 08-19-2007, 05:14 PM   #9
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We try to be good shoppers and save some $$ on clothes, food, insurance, house hold goods, and other stuff. But, we also like certain things and are not willing to cut back in those areas. I have a rather large Dishnetwork bill to cover my HD habit; at home and in the RV. We may cut back there some day but not yet.

We also spend a lot on fuel; well diesel anyway, the COW (condo on wheels) does drink a lot of fuel but we plan for that expense and cut back in other areas to keep some balance in our budget.

Some of the items we have cut back on since ER are:
Gifts...we are much less likely to buy expensive gifts for family or friends. Small token of our appreciation are about it. Christmas will continue to be cut drastically. We started this last year with the grandkids and will continue to do so to keep form going overboard like we used to.

Utilities: we are home more so we can keep a better handle on when the AC is on vs a room fan. Some days we just keep the windows open and have spot fans to keep cool. It has helped the electric bill some.

Water is another area we look at closer. I can test the sprinklers more often and make sure they are not broken or are running too long. I have installed a partial drip system in some flower beds as a means of conserving water.

Telephone is an areas I am working on too. We have an extensive wireless account(s) and rarely use our home phone but the DSL is discounted because we have a home phone. It might not save us much to get rid of the phone but we are still looking at it.

I am sure we will find other areas to cut back. I am selling my truck as I no longer need it. That will save on insurance, gas and will give me more space in the garage to work on some long over due projects.
Work? I don't have time to work....I'm retired.
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Old 08-19-2007, 07:15 PM   #10
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In a haphazard manner.
Same here...although, I would say that more of a one-time event when I started tracking expenses last year...I probably should look more often quarterly to look for stuff...
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Old 08-19-2007, 07:39 PM   #11
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I do it only haphazardly, although I am aware of the big ones when paying bills.

AT&T: DW,DD & MIL cell phones, plus land line with long distance &
DSL: over $220+/month ( Any ideas? I hate this one.

Water was a big one until I moved last year. Now on a well )) BIG savings

Need to sell a car. Might be able to find better rate, but hate to leave USAA. In fact, last refinancing, loan guy as much as said I was paying twice as much for homeowners insurance as I should be. But at 5 miles from the fire station...they have a formula, told them I'd have the fire truck just pump from my lake, they wouldn't go for it.

Directv, ouch! too many sets, DVR's, even with no premium movie channels it's over $90/month. Help!

Can't even talk about electric bill in summer, AC for DW who's ALWAYS to hot runs over $300 in summer, with fans helping. Looking for solar arrays or anything to help here. Need a technical breakthough, or a window unit for DW.
Can't you see yourself in the nursing home saying, " Darn! Wish I'd spent more time at the office instead of wasting time with family and friends."
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Old 08-19-2007, 07:39 PM   #12
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Every month I track the overall expenses in a spreadsheet showing the +/- increase over the target monthly and ytd. Every few years I brekdown the statements and track expenses in detail by category.

Always on the look-out for better phone, cable, insurance rates. I also track the energy bills and consumption every month to look for trends indicating poor behavior or loss of efficiency.
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Old 08-19-2007, 08:42 PM   #13
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I don't think we spend alot of time shopping around any more. It's probably because we just don't buy stuff or if we do, we just don't compare anymore. I'll give a few recent examples.

First, I had some trees removed and other trimmed. I didn't want the hassle of finding a tree service or getting several bids. A neighbor had his trees trimmed, so I just asked the crew to do my yard as well. It was $450 for a few hours of work. Maybe I could've gotten it cheaper, but

Second, I needed a new computer, saw an ad with free shipping and bought it for $25. I didn't bother to shop around because I know a good deal when I see one.

Third, I don't go driving around for the best gasoline prices because I fill up every 6 weeks or so. We don't drive around for the best deal on food either. It's the closest grocery store for us.

For the old stuff: phone is from a local mom/pop outfit and we have no choice. We already are pretty thrifty with utilities, so no potential savings there. We already have high deductible insurance ... maybe we could switch providers and save a little. We never have had life insurance.

My wife did spend a little time car shopping a year ago.
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Old 08-19-2007, 09:22 PM   #14
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Every year we try to look at our budget and find ways to reduce our expenses without reducing our standard of living. In the past year for example we have tried to reduce our electric and phone bills. To reduce our electric bill, we have installed a programmable thermostat and new energy efficient light bulbs. To reduce our phone bill, we dropped our land line (which was mostly used by telemarketers to bug us all the time anyways) and we now use exclusively our cell phones with nationwide plans. For international calls, we replaced our MCI International Call Plan with Skype. These few moves alone have saved us about $2000 so far. In previous years, we have moved our investments from a full service broker/financial advisor to Vanguard. That saves us thousands a year in fund fees, commissions, advisor fees, trading fees... We also shop around months in advance for airfares to make sure we get good deals. We also shop around for insurance policies (though we always stay we reputable companies).
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Old 08-19-2007, 09:36 PM   #15
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Directv, ouch! too many sets, DVR's, even with no premium movie channels it's over $90/month. Help!
Netflix or blockbuster is less than 20 bucks a month and can rent just about all of the cable tv shows without commercials and movies...some even get dvds at the library (ours is too small to have much)....

Or one of our more famous members, gets blank dvd discs down at his friendly Target and burns his movies for latter viewing....

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