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Money Saving Tips #4: Spend Now to Save Later

May 25, 2010 · 18 comments

in Money Saving Tips, Personal Finance

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:

  1. 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.
  2. 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.
  3. 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.
  4. 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.
  5. 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…)
  6. 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‘.)
  7. 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.
  8. 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!
  9. 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?

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{ 13 comments… read them below or add one }

Money Reasons May 25, 2010 at 12:21 pm

We also pre-pay our internet access and car insurance. You can get substantial deals on both if you pre-pay. I know that’s not exactly what you are posting about above, but it’s kind of close 🙂

Great tips as always 😉

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Kris May 25, 2010 at 8:30 pm

Money Reasons – I have never thought to pay my internet. I have that Comcast triple play, so I wonder if it isn’t an option since I also have my bill tied to phone and cable tv.

You just reminded me that I need to call my car insurer to get a lower rate! Thank you! 🙂

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Budgeting in the Fun Stuff May 25, 2010 at 2:20 pm

Fantastic list! Like your point #2 says, ask if there’s a discount (especially for big ticket items) if you pay in cash. We’re saving 5% on hubby’s dental work since we offered to pay in advance in cash. I simply asked if there was a discount for paying in cash, and the guy promptly said “5% since that’s what the credit card companies charge us anyway”. Woot!

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Kris May 25, 2010 at 8:32 pm

BFS- I always charge my dental work because it seems whenever I go in there, I hear the words ‘root canal’. (I do pay it off at the end of the month though).

The dentist scares me… good job to you for getting that discount!!

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Rebecca The Greeniac May 25, 2010 at 8:08 pm

Great suggestions! Paying up front is the way to go… no debt and no interest! I don’t even want to think about how long it’s been since I’ve been to the dentist though…

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Kris May 25, 2010 at 8:34 pm

Greeniac, you have to make the dentist appt.

Tell you what, I will call the eye doctor and you will call the dentist. Deal?

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Kevin@OutOfYourRut May 25, 2010 at 9:03 pm

Wow that title sure is…misleading! But I totally agree with what you’ve written. In the categories listed, either you’ll pay now, or you’ll pay more later, so the real economy is in getting certain things taken care of and out of the way now to improve your situation later.

I also think you’ll have more control of your time and your mind, with so much taken care of ahead of time. Let’s face it, most of us are procrastinators!

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Kris May 25, 2010 at 9:07 pm

Kevin- Sorry if my title was confusing. My point was just that sometimes you have to spend some money now so that you don’t pay as much later. (which in my mind, means saving later I guess.)

Thanks for visiting!!!

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Cheapskate Sandy May 26, 2010 at 2:55 pm

I love that you’re so counter intuitive but it all does make sense. One of the things that I regret is having a tiny kitchen which doesn’t allow for a decent stockpile when I find some serious bargains. I’ve been known to leave stockpiles at my mom’s and she usually ends up dipping into my pile.

Signing up for a flexible spending account is also good idea. I covered how that one can save you money on my blog, but the changes that the President signed into healthcare will limit the amount that I can put aside. Can’t always win I guess.

Thanks for letting me drop in on a fellow Yakezie.

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Kris May 27, 2010 at 10:29 am

Sandy – How dare your mom touch your stockpile! I used to have a small kitchen like that too, so I understand what you mean. Plus, paper products take up a huge amount of space.

Drop in anytime!!!

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Merrill Chapple September 23, 2010 at 8:10 am

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rain@free groceries February 7, 2011 at 12:02 am

Hi there!

Wow! You have a really clear long term plans for your family which I think is a great thing. As I can see it, yours is more on the preventive side which again I think is great.
These are very good tips that I think I can apply in my life too, but not all of them of course due to some financial. For now, everything must be on budget.
What I just do for today is avoid using the credit card, and just utilize whatever money that we have and trying to save some for future use. Another thing is that, we make sure that we are paying the bills on time, to avoid those extra charges. 🙂

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Elisa Jed August 8, 2013 at 10:22 am

I agree, go to the doctor as soon as anything problematic shows up. More times than not, you will have caught something that would have gotten worse and cost you more. I looked into an optometrist in Edmonton as soon as I realized I had a problem, it saved me money in the long run.

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