Recurring Expense Hacking FTW

19 Apr

An alternative title for this post: Justifying My Cupcake Addiction. The reason will become clear.

Photo by 401(K) 2012 via Flickr Creative Commons

Photo by 401(K) 2012 via Flickr Creative Commons

Recently, my husband hacked our auto insurance renewal and saved $250 on our annual premium. Then, he reduced our Verizon bill by $15 a month. His successes led me to finally cancel a $30-per-month supplemental insurance policy I’ve had for over a decade and never used. All this happened over the last few weeks, but it wasn’t until I read Jim Wang’s recent Elite Daily article that I realized what we’ve accomplished.

We saved money without changing our lifestyle one bit.

Spending less is tough when you’re focused on reducing or cutting out specific expenditures. It’s especially hard since the first things to go are often experiences or indulgences we enjoy most. In my case, the areas in which I planned to spend less actually don’t represent hefty expenditures. I dine out infrequently, don’t have cable and spend very little on clothing.

Yet, my first idea for cutting expenses was reducing the whopping $4.50 average monthly cost of cupcakes. There are health reasons for that reduction too, of course, but really? I think I looked at an easy expense to cut and chose that one, because it’s so obviously unnecessary. However, reviewing recurring expenses and making cuts there has had a much bigger impact on our budget without affecting our lifestyle at all.

Obviously, consumers who want to save money should reduce daily spending AND look for ways to cut back on recurring expenses. Together, these pursuits will free up some cash to be applied towards financial goals. But focusing solely on daily expenditures as I initially did is shortsighted and, in some cases, cruel. After all, punishing myself for a $5 monthly indulgence is not going to help me achieve my financial goals.

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