I recognize the title to today’s post may seem a little contradictory. Save money/spend money? Well, I am a big believer in spending some money now to save money in the future.
Some of the areas I am willing to pay for now, to save financial pain later is the following:
- Stockpiling groceries: When we remodeled our kitchen, I made sure there was room for my stockpiling habit. So, we have a pantry area with shelves that I can store all my extra groceries. Keep in mind, I am obviously not stockpiling perishables. However, if baked beans are on a great sale and I have coupons, I will buy as much as I can so I don’t have to pay full price in the future. Ideally, I buy as many of an item as I will use until the next sale comes along. This does not mean I buy items I don’t need!! There are certain things I know I will go through a lot of, so I might as well buy it while its cheap. Salsa is an example of this. Every 6 weeks or so, Salsa is buy one, get one free at our local store. We go through Salsa like water in our house, so it makes sense for me to buy 12 jars. The only time I will get something I don’t normally use is if it is free, or close to free. I then usually donate it.
- Services (for example, lawn fertilizing): I pay for services up front in one lump sum if they offer a discount, which most of them do. I do the same for the kid’s braces. Always ask for a discount if there isn’t one already offered on a service, especially if you are going to pay in cash. Doesn’t hurt to try.
- Gifts: I shop for Christmas all year long. For instance, my daughter loves craft items. I clip those Michael’s coupons in the paper and buy things throughout the year and hide them. You can really save on gifts if you do not wait until just before the event. Plus, you can usually put more thought into the gift when you have more time instead of just buying something because you have to.
- Dental work: Who doesn’t hate the dentist? Well, I don’t mean ‘who doesn’t personally hate their dentist’, my dentist is actually a pretty nice guy. However, my teeth apparently are covered in a sponge-like material instead of enamel as my teeth still get cavities at the drop of a hat (or the bite of a cracker). Since my teeth are so soft, I actually have dental cleanings every 4 months (my idea, not my dentist’s) to try to catch problems before they get too far. That means one of those cleanings each year are my financial responsibility. However, it is worth it to me because I cannot stand the financial or physical pain for dental work. Has this strategy prevented extra dental work? I have no idea. But, I feel better with this plan, so it is worth it to me. So even if you hate going to the dentist, you really need to bite the bullet and go in for a checkup a couple times a year.
- Health Physicals: This one is a no-brainer. Catch any physical issues that may be lurking as soon as possible to save years of pain and expense. This includes eye exams too (which I recognize I am late for, now that I think about it…)
- Auto Maintenance: Car getting up in miles? If you have a trusted mechanic, get that car checked out. Not only can auto repairs be expensive, but you do not want to be stuck in a broken-down vehicle on the side of the road. However, do not go overboard with this. Schedule maintenance based on the Manufacturer’s guidelines, not that of the dealer that is trying to make more money off of you. (For further reading regarding car maintenance, check out this article at MSN Money Central titled ‘20 Ways You Waste Money On Your Car‘.)
- Healthy Food: I am not one of those people that requires everything be organic before I eat it (think Kate Gosselin…). However, I am a proponent of eating healthy foods that require preparation, as opposed to cheaper, convenience foods. For example, I know salmon is generally expensive. However, I prepare it frequently because of the positive benefits it has for my body. Over time, hopefully healthy eating will keep me out of the doctor’s office.
- Mortgages: When interest rates were dropping and we decided to refinance our mortgage, we evaluated the cost of a 30 year mortgage versus a 15 year mortgage for the same loan amount. The difference was only a few hundred dollars a month, and we would be out of debt in half the time. So, we went with the 15 year mortgage. Plus, the interest rate was lower on a 15 year mortgage than a 30 year. If you are thinking of buying a home or refinancing, consider a shorter mortgage term. Try to consider only homes you can afford to buy on a 10 or 15 year mortgage. You will be very happy you did when you make that final payment!
- Contribute to a Health Care Account: Do your best to estimate your outflow for medical/dental expenses for the year and sign up for the health care account if your employer offers one. Where else can you guaranteed make 25-33 percent (whatever your tax bracket is) on your investment? Obviously, you have to be conservative when you select the amount to withhold since you lose what you don’t use. But going back to braces, using our health care account saved us over 1,000 dollars.
So overall, it may be good to have a little extra in your budget to be proactive about certain items in your life instead of having a bare-bones budget that only covers the bare minimum. However, if you are living paycheck to paycheck and only buying necessities, I recognize that may not be possible.
What other areas are you willing to pay more for now in hopes of spending less later?