Money

Trimming Monthly Bills – Psychological Warfare

For most of our adult lives, me and my husband adopted the “out of sight, out of mind” mentality. As long as we could “afford” it and nothing outrageous caught our attention, our recurring bills were pretty automatic. Its not until these past few years that we started moving towards the mustachian way, that we took a cold, hard look at what exactly we were paying for, and gasp, other options.

Some of our bills were real easy to identify as money wasters. But others required research, and an all out change in our lifestyles. This was a process for us, which realistically could have been condensed into a few months, versus the two years it took us. 

One note, me and my husband work from home, and are raising our four and five year old kids by ourselves 24/7. We have very little luxuries in life, so the thought of cutting the few we had left took some emotional toll. I think the secret for us was to do this in baby steps, and find replacements for everything. In other words, if you are going to cut out access to your favorite shows, make sure you have other options on hand that are equally fun, like spending time outdoors, jigsaw puzzles, writing, etc. Don’t leave an empty void.

Here’s a summary of the biggest bills we cut in the past two years…and I’m sure next year there will more to come!

Cellphone

This was a tough sell for my husband. We both have iPhone’s, but nowhere near the latest models. The issue was mostly our service provider, and the fear of having crap service if we switched to an unknown. We have always used AT&T, and were paying a whopping $200/month for both our phones with unlimited text, minutes, and data (this includes a 15% company discount). 

On top of that, my husband was paying off the financing of his cellphone for another $30/month. He is a destructor when it comes to the phones, so he is constantly having to replace screens, and during more ambitious times, the whole phone. One time, he literally dropped it into a cup of water on our night stand. Who does that?

I started some investigative work, and ran into a local company called Cricket. Long story short, they offer zero contracts, and a steady price of $80/month, unlimited everything. I also found that they piggy back off of none other than the AT&T cell towers.

Our biggest fears were the reception and internet speed. We travel quite a bit for work, and we visit family every 1-2 months down in Miami (down the dreaded Alligator Alley). But our logic was if the reception is really horrible, we’ll find another provider. And if the internet speed sucks, well, we are on our phones WAY too much surfing the internet anyway. It might be a blessing in disguise.

We cast all our fears aside and leaped in head first, and haven’t looked back since. I can safely say that it has been a year, and I haven’t noticed a difference. And we are saving about $1440 a year.

Side note: Mr. MM is always mentioning two even cheaper providers: Google Fi and Republic Wireless for something like $20/month. Will definitely have this on my to do list for next year!

Cable/Internet/Phone Service

This was a small mission. We use Comcast, and their customer service will make even the nicest person lose their minds! Part of us didn’t even want them to touch our bill, because the chances of them messing it up were far greater than any savings we would accomplish.

But alas, we went against all odds, and called them anyway. We made the decision to cut out cable and phone service altogether, and just use Netflix and Hulu ($12 and $14/month) and our cellphones. I can’t even tell you for sure how much we were paying for just the cable portion, because it was bundled with other services, and their were a bunch of different fees associated. After a few hours of battling it out in the trenches, my husband surfaced victorious, and our bill went from $160/month to about $75/month

It took us about three billing cycles for them to get it just right, but for the past year, things have been correct. Also, I have the good fortune that my company pays us a monthly stipend of $150 for internet services, so definitely a big plus!

UPDATE: During Black Friday 2018, Hulu ran a very limited offer: any new clients would get the service for a $1/month for the whole year! We closed our account, and opened a new one under my husband’s email address. Keep an eye out if they do the same in the future. 

Car Insurance

When I tell you we had zero clue what everything meant as far as car insurance, I mean zero. Which is sad, because we have been covered for many years through Geico. Once we sat down and really looked at it, we discovered: a) we didn’t need half of what we were paying for and b) we weren’t covered for nearly as much as we thought. All this, and we were paying $138.65/month, which is $828.30 every six months for two used cars (2008 Jeep Liberty and a 2012 Volkswagon Passat).

Here is a quick rundown of the different coverage (keep in mind, these descriptions are super simplified):

  • Comprehensive Vehicle Coverage – Pays for damages due to theft, vandalism, etc. (Jeep – $5000 deductible/$17.10 per 6-months; Passat – $500 deductible/$52.10 per 6-months)
  • Collision – Pays for damages to your vehicle due to collisions. 
    (Jeep – $5000 deductible/$48.90 per 6-months; Passat – $500 deductible/$195.70 per 6-months)
  • Personal Injury Protection – Coverage for medical expenses, death benefits, work loss, etc. (For Me & Passengers – $1000 deductible/$170.90 per 6-months)
  • Uninsured Motorist Bodily Injury – Coverage for certain medical expenses, lost wages, pain and suffering, etc. (we rejected this coverage)
  • Bodily Injury Liability – Pays if you are responsible for another person’s injury or death in an auto accident. It also pays for your legal defense. ($10000 per person, $20000 per occurrence/$164 per 6-months)
  • Property Damage Liability – Pays if you are responsible for damage to another person’s property. ($10000 per occurrence/$179.60 per 6-months)

First thing we did was consult one of our close friends, who happens to work for a major insurance company as a claims specialist.

He mentioned that my Jeep was only worth $3700 at best. So the fact that my deductibles on the vehicle’s coverage was $5000 alone was dumb. I probably shouldn’t even carry this coverage, if I could. 

We went shopping, and finally landed on using Progressive. We tweaked everything around quite a bit, until we were very satisfied.

The lesson here, knowledge is power. Just by making a few adjustments, we are now paying $90/month. And to save even more, we paid the six month total up front, $450. That’s nearly a $100 savings. So really, it’s like if we paid $75/month.

A final note, I am a firm believer that insurance companies have this down to a science, and you are in fact losing money, because the odds are against you. For right now, we fall under the category, “we can’t afford a big surprise bill.” But one day when we are financially fit, this will get sliced even more. 

For more on that topic, check out MMM’s post here

Other Services

As mentioned in other posts, we completed wiped out certain services from our monthly billing: gym ($45/month), lawn services ($150/month), and a storage unit ($75/month). There is still one lingering over our heads: Disney World Annual Passes ($130/month). This will likely be on the chopping block next year. 

All in all, here is the final tally of monthly expenses.

Original Monthly Expenditure on Services Above: $768.65 

New Monthly Expenditure on Services Above: $373.

Is there room for improvement? OMG yes. But are we walking away with a big sense of accomplishment? Most definitely. 

And just wait till you hear what we did with our credit card bills. 

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