Cutting Recurring Costs

Updated: Mar 28

Some of the most important costs you need to look to reduce are recurring costs. These are things you have to pay for every month, year, etc. These can be things such as:

  • gym memberships

  • cable & internet package

  • rent

  • mortgage payments (refinance at a lower rate)

  • insurance (car, rental, homeowners, health/medical)

These cost savings don’t mean much at first but over time they really add up and will amount to more in the long run than other short term savings.

Start Big

When considering where to start, focus first on the bigger items. Saving $50 a month by ending your un-used gym membership is a lot more meaningful than saving 50-cent-off coupons for your monthly purchase of toilet paper (although everything adds up!).

Get Creative

Look at categories of what you spend your money on and think about getting a rewards card with great rewards for that category. For instance, if your biggest monthly expense are groceries, look for a credit card that will give you high cash back rates on that category. It’s amazing how many people do not properly utilize rewards cards. When considering different rewards cards, look at where you spend the most of your money on a recurring basis and tailor your search around that category.

Put in the Effort

It's also worth the effort in some cases to try to negotiate lower prices/payments for some of your monthly bills and expenditures. This has been known to be effective with cable companies in negotiating cable/internet packages. While it's a pain to sit on the phone for 30 minutes with the cable company, the potential savings over the course of a year are well worth it.

If you take one thing from this post, its that when looking to increase your saving one of the first areas to focus on is your largest recurring costs. You need to know enough about your spending to know what these categories are, and you need to get creative in thinking about ways to save more in these categories.

With a little extra effort and thought, your annualized savings will really add up in a big way.

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