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Home > Things I Don't Do - Number 3

Things I Don't Do - Number 3

March 26th, 2008 at 01:53 pm

A comment was left on my last entry about priorities with spending. My examples of things I don't do are just ways that my family has chosen to save. We began some of them out of necessity when our income was significantly less. Now that our income has risen, we continue to do these things while we splurge in other areas, wine seems to be one of those right now!! All the while we are saving almost 20% of our gross to fund retirement and college education.

My third "don't do" has to do with insurance premiums. We don't pay our premiums monthly. We pay them semiannually or annually. When we were on a tight budget I realized I could save by paying less frequently. As a result, I set up a way to put the money aside each month, so that when it came due I had the money available. I don't remember now how much the difference is in paying semiannually verses monthly, but at the time it was significant to us.

This system of escrowing our money to fund semiannual insurance payments led me to add more items to the list for budgeting purposes. I now have included auto registration, gym membership, and school registration fees in addition to the auto and life insurance. As a result I put away over $130 a month to cover these expenses as they come due.

I'm going to guess many of you do something similar. If you haven't considered paying less frequently, in any area, it would be worth looking into. It just might save you some cash that could be put to use elsewhere. When we first began, we put ours towards debt repayment.

Next week I hope to talk a little more about how to set up an escrow account for these types of expenses. Stay tuned!

Posted in Saving | 5 Comments »

5 Responses to “Things I Don't Do - Number 3”

  1. luxlivingfrugalis Says:
    March 26th, 2008 at 05:15 pm 1206551738
    1206551738

    Yes, I escrow and pay our insurance stuff similarly. I also do this for all kinds of things, subscriptions and membership fees, car tags, car repairs, etc. When something happens generally the money is already sitting in an account waiting to be used. NICE!

  2. debtfreeme Says:
    March 26th, 2008 at 07:01 pm 1206558108
    1206558108

    i do that for car insurance, renters insurance, contacts fr my eyes, car repair funds, vacations, magazine subscriptions, niece/nephew school fund risers ($10 a month just in case), medical copays, student loan payments (in deferment, make payments quarterly of half of wha ti saved) etc. It helps to know when the bill comes that it is ready to be paid in full. it is a nice feeling to write one check and be done for the year.

  3. treasureinheaven Says:
    March 26th, 2008 at 08:20 pm 1206562842
    1206562842

    Now there's some smart thinking. I look forward to learning more about escrow accounts.

  4. seven of seven Says:
    March 27th, 2008 at 01:26 am 1206581170
    1206581170

    Once you get yourself into a place where you can pay the annual bill when it comes in rather than pay in installments, it's such a wonderful feeling! One check. Done for a year. Yay! Good for you.

  5. Thrifty Ray Says:
    March 27th, 2008 at 03:42 am 1206589356
    1206589356

    I also keep an "escrow" account going for these types of expenses...and a Christmas club, a birthday club, etc. There is such pleasure in getting a bill and having that money sitting in an account ready to pay...after its drawn some interest, of course!! Im enjoying your posts...again, so glad you came out of lurkerland.... perhaps you'll motivate other lurkers to join in as well!!

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