“It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.” – Robert Kiyosaki
When our childcare costs hit a combined $20,000 a year for our daughters, we decided to take a closer look at our finances. Was there a better way to be more efficient with the use of our money while steadily improving our quality of life? And why was childcare so damn expensive? After taking a close look at all of our expenses, long term financial goals, and how our money was being spent, we made some simple changes to our life that have allowed us to save over $10,000 dollars in a single year.
Utility Bills – This might seem odd, but I simply asked our utility providers for a lower rate. It never hurts to ask! I politely called each provider and explained that as a loyal customer who has never had a late payment, I wanted to see if any promotions were available to lower my rate since I’m currently being seduced with lower rates from the competition. (Pro Tip – Call early on a Monday morning). Our Electric, Gas, and Internet Provider all offered discounts that amounted to a savings of about $40 a month, or $480 annually.
Cable – We decided to drop our traditional cable and decided to use a streaming service. We have no annual contracts and plenty of flexibility unlike the big name cable providers. Best of all we are still able to watch live TV. By dropping traditional cable and switching to streaming TV, we saved $75 a month, or $900 annually.
Cell Phone – My wife and I dropped the pricey unlimited plan and long term contract for our phones. Instead we bought two smartphones outright and added a basic prepaid phone plan that still gave us talk/text/data. Our phones are used for phone calls, texting, and taking photos of our kids. We don’t play games or watch movies on our phone so this was a great option for us. By changing our phone plan, we saved $80 a month, or $960 annually.
Mortgage – With so much equity built up over the last few years, we decided to refinance our home. We also purchased a home that didn’t stretch our finances which leaves us with the opportunity to pursue other investments in the future. It was a simple process that saved us $220 a month, or $2,640 annually.
Auto Loans– My wife and I have the titles to our vehicles (a Dodge Ram and a Ford Escape). They run well, look good, and allow us to never make a car payment again. When we do decide to purchase a new(er) vehicle, we will pay cash. The problem is that cars are both expensive and awful investments — in fact they are guaranteed to decline in value. When you invest, you hope that the value of your investment will increase, but when you buy a car, you know that its value will steadily drop. Since the main purpose of a car is to provide transportation, it may be time to rethink how and why you are purchasing a new car. Without a car payment on our two vehicles, we are easily saving over $450 a month, or $5,400 a year.
Those changes brought us to a total of $10,200 dollars in savings in one year!
Although some of it was saved, we did splurge a bit on some home renovation projects and a family trip to Disney. It is our hope that we can teach good financial stewardship to our kids and show them that they must gain control over their money or the lack of it will forever control them.