Wednesday, July 4, 2012

Budget Areas in Which We’ve Found Huge Savings

For me, not only does saving money make me feel good, but the process is something that I find quite interesting. Having tracked our expenses over 15 years, I’ve noticed interesting trends, found frightening revelations, and been able to utilize the data I’ve gathered to make personal finance decisions, adjustments, and modifications.

One thing in particular that I’ve been able to observe from this tracking is where we’ve saved the most money. Here are some of the high impact areas where we’ve been able to recognize the most in savings over the last five years.

Insurance
Between car, renter and homeowners insurance discounts, we’ve recognized thousands of dollars in savings. By utilizing things like claim free, multi-line, multi-vehicle, and similar discounts on our various insurance policies, we’ve managed to save upwards of $2,000 over the past five years.

Child Care
Before having a child, child care expenses might not be something that people give a lot of thought to, but the costs relating to finding daycare for a youngster can really add up. In our area of Chicago, costs for a week of child care can range from $200 to $250 a week. That equates to an average of about $11,700 a year, or $58,500 over the five year period that our son has been able to avoid such care while staying home with me as a work-at-home dad.

And now, with another child on the way and another possible five years of such care at similar costs, and we’re talking about a total savings for both children of around $117,000. Now that’s some big savings!

Transportation
Since I’ve been working from home for the past four-and-a-half years, we’ve saved significantly on transportation costs. Once I began working from home, we decided to sell one of our vehicles. Not only did we received $1,700 for this vehicle (which I had brought two years prior for $4,500), but over the next nearly five years, not having to maintain that vehicle has likely saved an extra $800 to $1000 a year in insurance, maintenance and upkeep costs.

Vacations
Since the birth of our child -- and the resulting higher vacation costs -- we’ve worked to try to make our vacations ones that we can spend with family members and friends. This not only allows us more quality time with these people, but it saves us quite a bit of money on hotel costs as well.

I’d venture to say that by planning these trips to places where we can stay with friends and family, we’ve in turn avoided hotel costs for at least eight days each year. With many hotels often charging around $150 a night, this equates to $1,200 per year or $6,000 over the past five years.

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