Today we’re going to be looking for ways to lower your fixed expenses. The beauty in doing this is that you only have to do the work once to reap the benefits all year long. Plus you’ll create some room in your budget that can be used for more important things.
Are you ready to look at ways to lower your fixed expenses?
Housing
Housing is normally the biggest budget expense. As a general rule of thumb your housing should eat up no more than 25% of your gross (before tax) income. If it is you’re setting yourself up for a whole lot of financial trouble down the line. (Which is why I’ll be taking the next couple years to save a large downpayment for a home.)
So what can you do to lower your housing?
- Move – If you’re renting your house this should be easy enough – move to a lower cost area. If you currently have a mortgage this might not be feasible.
- Bring in a Roommate – Rent out a room in your house to cover a portion of the payment.
- Refinance – If you’re paying more than 6 percent interest on your mortgage look into refinancing. Lowering your interest rate by just one point can shave thousands of dollars off the life of your loan. Just make sure that the refinancing fees aren’t cancelling out your savings.
Your Cell Phone Bill
With all of the options out there today for cell phone plans there is no reason you should be paying more than $50 per month for one phone.
The big carriers are rip-offs, plain and simple. Why pay for a contract when you can exactly the same service (with the same phone) for a quarter of the price by using a pay as you go service? Here are some options to look into:
Republic Wireless – Republic Wireless offers plans starting at $5 per month. Their service runs off a combination of Wi-Fi and towers which is why they can offer service at such a good price. I had the pleasure of trying out Republic Wireless last year and their service works incredibly well!!
I’m going to be honest I was extremely skeptical when I decided to check them out. I live out in rural Ohio and was able to get service almost everywhere. If you live near a city you’ll always have service.
Straight Talk – Straight talk is another pay as you go service. You can buy 30 days’ worth of unlimited talk and text for $45 a month. They also have very nice phones.
I’ve also used Net10 in the past and was really, really happy with their pricing and service and here’s a page full of Verizon Promo Codes if you prefer their service.
TV Packages
When I moved into the trailer I had every intention of getting satellite – I thought I wouldn’t be able to function without it, especially with two small Dora-lovin girls.
After a month of putting it off, I finally realized that we were perfectly fine without it. Actually we were doing great without it. I was working and reading more. The girls were playing more.
I know some of you aren’t convinced that life without TV is worth living and that is perfectly okay! Remember you’re working on YOUR budget. If you want cable TV make it a line item in your budget. No biggie!
For those of you looking to save here are some other options:
Downgrade Your TV Package – Not ready to part with TV altogether? Just downgrade your package.
Ask for a Discount – If you’ve been with your cable provider for a long time ask for a discount. When I had Dish Network I did this every time the bill went up and they were glad to lower my bill. When I had DirecTV I had no such luck and was instead passed around by customer service. If you’re with DirecTV give it a try but don’t hold your breath.
Netflix – Netflix can replace much of your TV-watching needs. Plus it’s awesome because you can watch an entire series in one sitting. (Okay maybe that’s a blessing and a curse!)
Amazon Prime – If you have Amazon Prime go check out all the free movies and TV shows you get. I watch Amazon Prime Instant Video A LOT and so do my kids. If you’re already paying for it then use it!
TV on DVD – Rather than paying for cable every month and only watching a few shows, you can purchase an entire series on DVD and watch episodes at your leisure. This is ideal if you have a few favorite shows you find yourself watching time after time. As an added bonus you won’t have to stream the shows, so you can avoid the data overage charges many internet providers are now placing on their customers. You will also save time since you won’t have to worry about commercials or waiting for the next episode to aire.
Car/Home/Renter’s Insurance
As a former insurance agent I’m here to tell you – if you don’t change your insurance every three to five years then you’re getting ripped off. The longer you stay with an insurance company the higher your bill becomes. All of the other insurance carriers want your business so they’re willing to start you out on a much lower plan. (This is assuming you have a good credit score, good driving record, and no teenagers on your policy.)
I would highly advise that you call an independent insurance agent (this is someone who does business with a bunch of insurance companies, not just one.) An independent agent can quote your policy apples to apples among several different carriers to make sure you’re getting the same coverage at a better rate.
Also read: what you really need to know about lowering your insurance.
Other Bills
There are some fixed expenses like water and electric that you can’t do a whole about. For other bills like internet services call the company and ask for a discount. The worst they’re going to say to you is “no.” It’s definitely worth the call.
Do It Once Reap the Benefits All Year
If you can get even one of your recurring bills lowered you’ll be reaping the benefits of one hours’ worth of work all year long. You’re getting way more value for your time than you would be clipping coupons or shopping sales.
So go ahead, start getting some of your bills lowered.
Love this! There are so many ways to lower fixed expenses. Our fixed expenses are pretty much as low as they can get, so right now we are working on our variable expenses 🙂
It’s so awesome how well the “ask for a discount” strategy works when it comes to your cable bill. I once got mine cut in half with just one phone call. And they threw in HBO.
Agree with this post, there are several ways to save money!!!
My biggest fixed expense is my rent. I’m definitely planning on moving this year to lower that cost!
I’m with Michelle — I’ve lowered my fixed expenses about as much as possible (living with a roommate, sharing a cheap cell plan, low insurance, no TV) so I’m really working to rein in my food and “other” spending right now. You’re totally right that lowering fixed expenses is incredibly helpful; sharing a house is the #1 biggest way I stretch my income so that I can build my savings.
These are great tips, Alexa. I am soon be switching cell phone providers. Will look at the companies you mentioned to see what plan works for me.
Cable is definitely a want and not a need, so if you need to save money, it should be cut. In fact, I think there’s more variety on Netflix than on cable! Great tips on the cell phone, too- no one truly needs an iphone and $100 per month data plan.
Great list! I’ve lowered my costs to the bone. Share a studio with my partner, no cable, and cheap cell phone plan. I think housing and food are where most people can cut back.
These are some great ideas! Our fixed expenses, sadly, are not going to get any lower. We cancelled our cable, our phones are as low as they are going to go, so is our insurance rates (we get military discounts thanks to my husband’s veteran status). Just about the only thing we may be able to lower is our electric bill, but I don’t want to sweat to death over the summer. 120 is just too hot.
I’m going to keep on my cable company until they lower my internet bill. They are holding out on me! I’ve done all of these except move or get a roommate That would be a VERY last resort!
Love this post! I think most of us first think about reducing variable expenses but there are lots of ways to lower these fixed expenses that we all have.
I did a few of these last year to lower my fixed expenses. The biggest one was moving 5 minutes away to save $400/ month on rent so I could put more money toward paying off my debt and saving. I’m getting by pretty well without cable tv as well. I think there’s plenty of ways to reduce fixed expenses and like you said, most of them only have to be done once and the money saved really adds up!
It’s always worth calling your service providers (such as cable, insurance, cell phone, etc) and asking for a discount, and then follow up again each year! There may be discounts you’re not aware of, or they may be willing to work with you on it. 🙂
my biggest problem is i own a home and can’t afford the up keep, where do i go for help with this?
Hmm that’s definitely a tougher one. Maybe getting help via government assistance if you qualify. If you don’t qualify the only other option I see would be selling the home and getting something that better fits in with your budget.
Getting a discount prescriptions drug card can be an awesome budget stretcher also. You can save up to 90% on prescriptions for you and your pet using the discount prescriptions card. Also, you might have already heard, but important to note that at the grocery store, eye level is buy level. So, look up or look down to discover store brands and other like bargains. This post is awesome.
Our local library has DVD and Blu-Ray (both entertainment and educational) available to borrow. Additionally, with a library card, there are numerous services available through our public library system. For example, eBooks, eAudio books, pajama story time, Hoopla Digital (movies and TV shows), digital magazines, music, FREE summer movies, visiting authors, magazines, newspapers, and current events are available.