On our pursuit towards financial independence, we are always looking for ways to lower our monthly costs. We all have recurring monthly costs and once we do retire, that will likely be the bulk of our expenditures. So no day like today to start figuring out how to minimize them.
Listed below are a few ideas we’ve used to lower our bills. We would love to get your ideas as well to see what we’ve been missing – so please comment!
Call Your Provider
I admit that we do splurge on a few things, and SiriusXM in our cars is one of them. Once you get treated to commercial free music, it’s hard to go back to regular radio. There are other ways to achieve commercial free music in your car (such as Bluetooth streaming in your car), but satellite radio sure is convenient. The problem is, every year SiriusXM wants to charge me around $200 for a year of service – for each car. I enjoy music, but it’s not worth $400 for us. That seems very excessive.
Every year shortly before the service is due to renew, I give SiriusXM a call to negotiate a better deal. Usually it’s a pretty painless process but I have gotten close to canceling at least once. A few times I’ve worked out a 6 months for $30 deal, but lately it’s been $99 for the year. Obviously, I would like it to be lower, but a 50% cut in cost isn’t too bad.
In regards to Internet service, we have Comcast and Verizon Fios in our area. I can usually get a good one or two year deal by bouncing back and forth between them. When the contract is up, I’ll usually give the current company a call to see what offer they can extend me before I threaten to jump ship. Sometimes, but not every time, they will end up presenting a compelling offer. And one more word of advice on cable internet – please don’t pay a monthly leasing fee for their modem. You can buy an inexpensive cable modem on Amazon or eBay and save yourself the $8 to $10 monthly fee that the cable company will likely charge you.
Change or Cancel Services
Another admission here – we still have a home phone. It seems like many people these days forgo having a home phone. I guess we are still ‘old school’ and like to have a home phone. But one thing we don’t do is pay the local phone company (Verizon) for home phone service. Years ago I purchased the Ooma Telo and have easily saved hundreds of dollars since. Assuming you have a broadband Internet connection, the Ooma Telo works great. Once you buy the hardware (around $85), your phone service is free, outside of any local fees and taxes. They also offer a premier service for $9.99 monthly that provides additional services such as blacklisting.
Yet another admission… I get a substantial discount on our satellite television service due to a sister company relationship with one of the satellite television providers. However, if I didn’t get this discount, I seriously doubt that we would pay for ‘traditional’ television service. We don’t watch much television to begin with, and with an inexpensive over-the-air HDTV antenna combined with Netflix, Amazon Prime Video, and/or Hulu, you can save some serious money. Some other interesting options include Sling TV and the upcoming YouTube TV. Also checkout the ‘Get Rid of your Cable Bill‘ post on Max Your Freedom for more information on becoming a cable cutter.
And then there is the cell phone. With a family of four, this is still a significant monthly cost for us. We are on AT&T and get a discount through work (see below), so I haven’t made the plunge to a pre-paid or reseller like Cricket Wireless or Republic Wireless yet. One thing that we don’t do is buy crazy expensive phones on contract. Our $180 Motorola Moto G4 unlocked phones more than meet our needs. Learn more about how the ‘Waffles on Wednesday’ couple cut their cell phone bill in half.
Have you ever checked to see if you employer offers discounts on any products or services? As I mentioned above, I get a modest discount on AT&T service through my employer. We also get a Verizon discount as well. We also get a discount at many of the local health clubs in the area. If you use Microsoft Office products, then your employer may also offer the Microsoft Home Use Program where you can get a copy of Office to use at home for $9.95. Throw in a few other discounts like reduced movie tickets and maybe work isn’t so bad… nope, strike that – we still want to retire early.
Save Energy = Lower Bills
Another significant monthly cost is our utility bills. We have a combination of electricity and gas, in addition to water and sewer. An obvious way to save money on your energy costs is to install a programmable thermostat. Why heat or cool your house to a comfortable temperature when nobody is home? I think our dog will survive when he’s home alone if it’s a little warmer or cooler than we humans would prefer. We have a Bryant thermostat that was installed when we replaced our heat pump and furnace. Nest is probably the most popular, albeit expensive option.
Whenever a light bulb burns out, we always replace it with a LED light. The up-front cost is definitely more expense, but the energy consumption is way lower than a traditional light bulb. And the costs are dropping quickly – Home Depot, Lowes, and Costco sell packs of LED light bulbs for reasonable prices these days.
If you do need to change out your appliances (like our heat pump and furnace replacement), please consider the new model’s energy efficiency. There is likely diminishing returns at some point, but you can get really efficient windows, doors, and appliances for a reasonable cost. Reduced energy consumption is a win for everybody, including your bank account!
Our largest monthly expense is groceries. This is an area we need to get better at. I’ll read what other FIRE bloggers spend on their groceries and I’m envious. There are numerous things we could do to reduce our grocery costs (shop at Aldi more often?), and we’ve had some success with couponing. It helps to mention that we essentially are feeding four adults right now with our boys turning 19 and 18. If you have teenagers, especially boys, you know that they seem to be endlessly hungry!
There was a time, not long ago, where Mrs. Need2Save was a bit intense on the couponing. After what seemed like hours and multiple Sunday papers, we would be ready to head to the store. Once in the store, progress was slow as we checked and rechecked our coupons to make sure we bought the correct items, the correct size, and the correct amount. It was a bit too laborious for me. I’m a big fan of the 80/20 rule – meaning 20% of the effort can get you 80% of the result.
Now we are more relaxed on our couponing approach. Without too much effort we can find and use coupons that we are likely to use. Couponing has also evolved as well. Many large chains now offer the same or substantially close to the same number of electronic coupons saving you time if you just click through them before heading to the store. We shop mostly at Safeway and just take a few minutes to click these before heading to the store. I like to make it a game; for example, I can get Netflix if I can find $10 in coupons per month.
The side effect of this shift, was we realized we could cancel our paper subscription because we didn’t really care for the quality of the content to begin with. If we didn’t need the Sunday paper for those coupons, no need for the delivery. We haven’t really missed it to be honest.
One last technique we use, when possible, is to pay our bills using our best rewards credit card. Currently that is our Citibank Double Cash card that yields 2% cash back. I’m sure we could find even more ways to save and we are looking forward to hearing your suggestions.
What other strategies or hacks are you using to lower your bills?