How To Save Money On Your Monthly Debits: 7 Simple Tips
Monthly debits are extremely convenient for everyday life. We set them up, then get to sit back and relax, safe in the knowledge that our money is going where we need it to go — and we certainly take advantage of this, using them for so many parts of our lives that we can easily stack up numerous debits each month. But this convenience also makes them dangerous. More and more, people are waking up to the alarming possibility that their money is being drained unnecessarily on a monthly basis, with each month taking away another substantial chunk of the average person’s savings. But you don’t have to just accept that it’s happening. You can take action to get your direct debits under control. To help you lighten the monthly load and improve your finances, here are 7 simple tips you can use to save money on your monthly debits:
Look for alternative providers
There are some monthly services that don’t give you much choice when it comes to a provider: for instance, you might only have one viable internet service provider in your area, limiting you to paying whatever you’re currently paying or having no internet access at all. But for most services, that isn’t the case. Take energy, for instance: when was the last time you got a fresh energy quote? You might find that switching provider will save you quite a bit of money.
Haggle for better prices
Moving business transactions online has added a sense of unwarranted finality to certain price listings. If you’re looking at a product on an ecommerce site, then sure, you’re unlikely to get anywhere proposing a cheaper price — but service businesses tend to have a lot more leeway. With customer retention being a priority, and their margins being healthy, they’ll often offer better deals if pushed. As such, push them. Ask them to give you a better deal, and play competing services against one another until you get an offer you can’t refuse.
Cancel services you don’t need
It’s thrilling to sign up for new monthly services. Product services are particularly dangerous because they give you a great sense of anticipation: each month will bring something new, indulging your love of retail (particularly when you’re stressed). But that thrill can easily leave you paying for things that don’t really interest you — things you don’t really need. If you’re a member of a monthly wine club, ask yourself if it’s worth what you’re paying. If you pay a gym membership, do you actually go on a regular basis? Enough to justify the cost? If not, cancel it.
Stop paying for cable
Cable packages can be very expensive, but plenty of people these days only use them for media that they could get far more cheaply online. Check to see if there’s a comparable online TV streaming service that would cost you much less. If your internet connection is up to the task, and you already pay for the bandwidth, then why not take this route? You may need to buy a streaming device for your TV, but that’s not expensive.
Cut your car insurance costs
Car insurance is one of the worst monthly payments because you can’t get rid of it entirely (assuming you need to keep driving, that is), but it can be quite expensive if you get a bad deal. You don’t have to accept a bad deal, however. If you take steps to warrant a better quote — for instance, by lowering your mileage, keeping your car in a garage, or even installing a dash cam/backup camera to prove your commitment to responsible driving — then you can end up significantly cutting your monthly car insurance costs.
Opt for annual payments instead
Some monthly debits you have to pay monthly, but there are plenty that you can choose to pay annually instead. Since you’ll generally get a better deal in return for choosing to pay a year at a time, you should use this for anything that you know you’ll want for at least 12 months. If you want to keep canceling and renewing a subscription (to something like Netflix, for example), then keep paying monthly. Just switch to paying annually where it’s appropriate.
Set up a savings debit
Sometimes a good response to excessive monthly debits is the addition of another monthly debit: this one to your own savings account. It’s all about taking an informal commitment and setting it in stone (so to speak). If you usually forget to save money, this will force you to — it will also prevent you from spending everything you have each month, and force you to find something less important to cut if you start to feel the squeeze.
Saving money isn’t about doing complex calculations. It’s mainly about looking at your monthly outgoings and finding small improvements, whether that involves getting rid of unused services or negotiating better deals. Give these tips a try — see how you fare.