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How to shave expenses on an already spartan budget

January 20th, 2011 at 12:06 pm

As a cost-saving measure in 2010, I decided to cut my (basic) cable, which at that time was costing me $25 a month.

When I talked to the rep, he offered to cut my bill in half (!) and said that price would be good for a year. (Too bad I didn't know they'd do this for all these years I've been paying full price. Of course, I know now they only offer to do this when you announce your intent to cancel.)

So I agreed to keep the cable at the reduced price. Everything was fine for 3 months, but after that, the cable company (Charter) raised their rates and my monthly bill inched up again, from $13 to $18.

I called the cable company again when it happened, but ended up getting in an argument with the rep, who kept trying to explain that my promo rate was still intact, even though my overall bill increased. I, on the other hand, didn't feel that Charter had honored its agreement with me.

So in the face of continued job/money issues, I again decided today to just cancel the service entirely; there are so many alternatives available. I got interested in Roku initially, but decided against it since you need at least intermediate speed DSL to stream the video,and that added expense ($10 a month) would partially defeat the purpose. There's still Hulu.com and my local library. And I'm still prepared to just go cold turkey.

I called today and got a very professional rep on the phone who made everything so easy. He not only reinstated my $13 a month service but is giving me a credit for all the months I've been paying $18 a month. How cool is that? The revised pricing is only good for the length of my original involvement in their "discount program," in other words, June 2011. But then I'm to just call back in again and see if they have other promotions going on; if i again feel the need to cancel, I can do so at that time.

So I'm pleased to have cheaper cable again, although there's a part of me still wondering if I would have been better off saving $18 a month, given that I'm still not working and 1) my unemployment benefits have decreased slightly (by $9 a week), I'm not yet sure why and 2) my expenses have dramatically increased (by $268 a month), due to higher COBRA costs.

I guess discounted cable is OK for now, when you consider I'm also shaving expenses by doing the following:

1. I intend to not renew minutes on my prepaid cell phone in March, saving me $100 for the year. I discovered that I can buy 700 minutes of call time with a Verizon card from Costco for just $20, which comes out to about 2.86 cents a minute, so I'll rely on calling cards (as I've done before) instead of the cell phone. (I also already dropped my ability to dial long-distance on my land line, thereby saving me $2 a month with AT&T.)

2. I also plan to drop my AAA membership, saving me $90 a year. Initially I didn't think i wanted to cancel it since my membership gets me 15% discounts on car repairs at the Honda dealer (In previous years, I spent about $1,000 or more on car maintenance, so the AAA discounts wound up paying for my membership, but last year, I only spent $165 on car maintenance.) I don't intend to get anything other than oil/filter changes done in 2011, knock on wood. Since I'm not driving far or commuting these days, the AAA membership seems superfluous.

3. As mentioned above, I'm limiting car repairs to routine oil/filter changes, about once every 5,000 miles, as well as tire rotations, since they are free at the place where i bought my tires.

4. As blogged about earlier, I'm cutting food expenses by 18% and limiting monthly grocery expenses to $180, instead of the $220 a month I averaged in 2010. I already know I didn't hit that target for January due to my bad math (!) and partly because I included a $40 Costco membership fee as a grocery expense.

I have already switched to a lower cost electricity supplier, increased the deductible on my homeowners a 2nd time (to $5,000) and dropped collision and comprehensive on my 12-year-old car. And of course it's a given that all discretionary expenses, like dining out, entertainment, clothing, Netflix, gifts and routine healthcare, are deferred. (I did recently have a mammogram and plan on seeing my neurologist next week, only so as to be able to renew a prescription I need for the MS.)

So my minimal necessary expenses, which are mostly the mortgage, health insurance, car/home insurance and utilities, comes to $2,212. My net unemployment comes to $1,868 a month, leaving me with a monthly shortfall of $344, which I will try to make up doing freelance writing, online surveys, selling stuff on Craig's List, doing focus groups and of course looking for f/t or contract work.

Looked at another way, if I somehow manage to stick to my spartan budget but do NOTHING to earn income above the unemployment benefits,I'd be out of pocket $4,128 for the year, which, in the grand scheme of things, is not the end of the world. And I'm really in much better shape than many others out there who are struggling to pay off big credit card debt, car loans, student loans, etc. I'll have my home paid off in a few years.

Of course, I plan to work as hard as possible not to dig into savings to make up that shortfall. Thus far in January I've gotten about $375 in freelance work, so I'm getting off to a good start.

9 Responses to “How to shave expenses on an already spartan budget”

  1. Joan.of.the.Arch Says:

    Looks like you are really working at it. Good luck in finding good employment, too. Smile

  2. SavingsQueen Says:

    Congrats on all your good ideas and cutting your budget to the bone!! You are in grate shape!

  3. davera Says:

    Since you're dropping your AAA membership, you might check with your auto insurance agent to see what it would cost to add emergency roadside assistance to your coverage. It can be as low as $4 a year, certainly worth it for peace of mind.

  4. Petunia 100 Says:

    I think you're doing an amazingly good job of keeping spending to a bare minimum. I'm impressed that your home is almost paid for!

    Best of luck to you job hunting in the new year.

  5. CB in the City Says:

    You can be proud of how well you manage even while unemployed. I'm very impressed.

  6. HouseHopeful Says:

    The nice thing about AAA is that you can sign up for the service the day you need it & just pay by credit or debit card over the phone. I did that once and they came an hour later & towed me Smile

  7. Jerry Says:

    You are really making it work in the face of adversity, and I think that will lead to more opportunities to save as well. I can't get over the cost of COBRA, it can really put people in a hard spot just trying to keep health insurance. It's unbelievable how costs have spiraled for health care.
    Jerry

  8. patientsaver Says:

    Yes, Jerry, the cost of health insurance has always seemed to be my nemesis. Years ago i tried freelancing for a living, and if it hadn't been for the cost of health insurance, I could have done it.

    Now, once again, the high cost of health insurance is messing up my life. And from what i hear, $443 is not incredibly high, just "typical."

  9. Jerry Says:

    You are really making it work in the face of adversity, and I think that will lead to more opportunities to save as well. I can't get over the cost of COBRA, it can really put people

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