Sometimes I geek out over a new idea or way of doing things. Maybe it’s from my dreaded Operations Management class in college where we had to prove with math how best to get things done, like driving a UPS truck through town as efficiently as possible. Here are some things that I do which might give you some ideas to tweak your efficiency with household spending and more.
In no particular order:
- Recently I found a simple no-frills no catch 2% cashback credit card from Citi.com. It’s called the Double Cash Back card, and you accrue 1% when you spend on it, and 1% when you pay it off. If you are reading this, it’s likely that you don’t carry a balance on your cards from month to month. If that’s true, and like me you don’t want a new hobby of tracking reward points, this might be a good savings tool for you.
- If we assume $3,000 a month spent on the card, that’s about $700 a year.
- In that theme, we also use the Target and Amazon credit cards for an easy 5% discount, and also Costco for extra breaks on food and Gas. We also use the Costco Executive membership for an extra 1% cashback at the warehouse.
- $1,500 a month spending, perhaps $500+ per year.
- Switching from cable to streaming services and cell phones cut our bill by about $65 net per month. Sure we miss out on having the old DVR, but streaming is good enough for us. We watch the Vikings over a $10 antenna and use Netflix for $14 a month. We also have Amazon Prime, but I’d have it even without the video services for the low-cost shipping so don’t bother to add that. If you are really into sports, one of my friends advised some of the online services like YouYubeTV, MLB.com, etc. We like Roku’s as our TV interface, and I even keep one at the office for financial news.
- $800 per year
- I winterize my lawn sprinklers by blowing compressed air from our air compressor, and a one time set of $10 parts from Home Depot. It’s not really that complicated and has become a changing-of-the seasons' activity with the kids where I also check for leaks etc.
- $90+ per year
- I drive a relatively low-cost car, and up until recently Allison was driving a really rough 2003 Suburban. If we could have anything, sure I’d drive a more comfortable vehicle but it’s not as important as other goals. In fact, driving a car you don’t worry about is incredibly liberating. My son accidentally hit it the other day when we were playing football, and he was horrified. I calmly said “and that is why I drive a $5,000 vehicle”! We replaced her 2003 with a 2015 with a decent amount of miles on it, so much of the depreciation has already occurred.
- $5,000+ per year
- Cancel unneeded subscriptions aggressively. One of the things you might know about me is I’m a nerd, and listening to talk radio from places like Bloomberg makes me happy. Up until recently, I was paying $10 a month to Sirius XM to have satellite radio in my car. Well, the new Amazon Alexa AUTO is out, and it makes listening to podcasts over the car speakers incredibly convenient. It even takes over on the car speakers if you get in wearing your ear pods. $25 was a steal for this device, and I told Allison I thought it was worth well over $200 to me.
- $120 a year, plus no need for an annual call to cancel because they raise the rate each year by more than double like the cable companies.
- Make the most of your situation. Interest rates right now are running about 3.50% for a 30 year loan. They will even let you take cash out at that rate. So if you are paying more for your mortgage, or have some variable rate home equity debt or otherwise, it might be a good move to take a look.
- $1,000+ a year
- Mow your own grass. I recently sold my riding lawn mower after 8 years for $400, I purchased it for $800. Operating costs were about $50 per year, and a mowing service would have been $1,000 or more per season. Now I do hire out the snowplow, because for me that's a splurge that is worth it.
- $900+ a year
- Eat in the office when you can. Lunch can easily cost $10 these days. I try to bring in leftovers when we have them, or heat up a cup of soup or a frozen meal when I can. At most my in office lunch ends up being $3 or less. I also drink soda from the grocery store along with "tap" water.
- $600+ a year
Please let me know if you would like to brainstorm around any of these ideas for your situation and thanks for taking a look!
Tom
This article represents opinions of the authors and not those of their firm and are subject to change from time to time, and do not constitute a recommendation to purchase and sale any security nor to engage in any particular investment or legal strategy. The information contained here has been obtained from sources believed to be reliable but cannot be guaranteed for accuracy.