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It’s been a month(again!) since I’ve written a post for the budget series, so I’ll be continuing that today.  See these posts for the history of this series.

This time, I’m looking at how to reduce my “set aside” funds.  These are the categories that don’t have specific payout amounts and happen at irregular intervals.   One of the convenient features of our set-aside funds–also a feature of our non-monthly bills–is that the money sits in our checking account, providing a buffer against overdrafts.   The buffer is big enough  that I can withdraw our entire month’s discretionary budget on the first of the month.

• Parties  – Twice a year, we have large parties.  We have a barbecue(not necessarily low and slow, I’m in the midwest) and a Halloween party.   We also have three kids with birthdays.   Each year, we try to do something exotic at the barbecue.  One year, it was a turducken.  This year, we’ll be skipping the show-off portion of the show.    The Halloween party is never expensive.   I don’t drink much, so the bar stays well-stocked without frequent expensive shopping trips.   We throw two large parties for less than $300 combined, and our guests start RSVPing a year in advance.  We’re fun.   The kids are getting gypped this year.   I am over my addiction to expensive birthday parties for my kids.  There will be a small party for one, a sleepover for another, and a party combined with some cousins’ birthday parties for the third.    It sound horrible but all of them will have fun.
• Gifts  – We set aside money for presents, but we don’t feel we need to spend all of the money we have set aside.   Anything left over stays here.  Eventually, it will be something nice for all of us.
• Pet Care – We have 4 cats and a dog.  Cat litter and food are expenses that we can’t make disappear.  We don’t buy the fancy food, but we also don’t buy the stuff that uses cardboard as filler.   We have set a new limit at 3 pets, but that limit will only be reached through attrition.   There’s nothing to cut here for a few years.
• Car Repair – This is another category with nothing to cut.   If we don’t spend it, and something catastrophic happens to a car, we’ll be covered.  If it doesn’t, we’ll have a bit more cushion in our checking account.
• Furnace Warranty – When we bought a new furnace and air conditioner, we got the extended warranty.   This is an unlimited renewal warranty, so, in 5 years, we’ll have to buy it again to keep it.  If we keep it forever, they will eventually replace our furnace when it dies.
• Medicine/Medical – It’s a sad fact that people get sick.   We set aside a small amount to cover our costs.   The costs rise and fall, but over any given quarter, I don’t think I’ve been off by more than $5.

I’ve taken a hard look at most of the bills over time, so there isn’t always a lot to cut.  Next time, I’ll be addressing our discretionary spending.

I keep calling these lessons, but they are examples and explanations, more than lessons.   Names aside, please see Part 1 and Part 2 to catch up.  The Google Doc of this example is here.

This time, I’m going to review my non-monthly bills.  These are the bills that have to be paid, but not on a monthly basis.  Some are annual, others are quarterly, or even weekly.  Every month, the amount–adjusted to the monthly equivalent–is set aside in Quicken.

• School Lunch – We don’t qualify for any of the reduced lunch plan, and I don’t know that it is possible to send a brown-bag lunch that is both cheaper and healthier than the school’s menu.  This is automatically replenished whenever it gets below $15.   This actually gets paid about every other month.
• Property Taxes – Semi-annual and increasing every year.   I know the valuations around me, so I don’t think an appeal would win.
• Life insurance – We pay this quarterly.   If I die, my family will be completely covered for several years, without adjusting a single expense.   If the expenses are adjusted to account for the fact that I won’t be eating, driving, or using electricity, it will last much longer.  This is a separate policy from the one discussed in Part 2.  GET INSURANCE!  Take care of your family.
• AAA – Since we got reliable cars, this hasn’t been a money-saver, but it’s priceless in terms of peace of mind.
• Vehicle Registration – We have two cars and a motorcycle that need registration every year.  I’m planning to sell the bike in the spring, but I was planning that for last spring, too.  It’s easy to put that off, since I enjoy riding.
• Daycare – Daycare is a weekly expense.  As a two-income family, this isn’t an expense we can do away with…yet.  As time goes on, the bill will be getting lower.   In June, my youngest reaches a cheaper pricing table and my oldest is almost ready to be done with daycare completely.
• City Bill – Our garbage and sewer are paid through the city on a quarterly basis.
• Web host – I’ve got this blog, plus a few other side projects hosted here.  I have been simplifying and reducing the projects that aren’t fun or profitable, but I’m not sure this expense will ever go away.

There aren’t too many items here that can be legitimately and responsibly trimmed.

It’s been a month since I’ve written a post for the budget series, so I’ll be continuing that today.  See these posts for the history of this series.

This time, I’ll be reviewing my non-monthly bills.  These are the bills that have to be paid, but aren’t due on a monthly basis.  Some are annual, some are quarterly.

• School Lunch – This could be cut by sending a bag lunch.   We pay about $1.25 per day for school lunch.   At that price, I don’t think I can beat the nutrition, let alone the convenience of the meal.  We pay this whenever the account gets below $10.
• Property Taxes – We pay this semi-annually.  This bill goes up every year due to the ****** ***-******* ******-******* who don’t care about their constituents making ends meet.  ******* ***** ******* *******.   Huh.  Who knew WordPress came with a censor?  I could move, but I’d have to get out of commuting distance to get this down much.
• Life insurance – I’ve got two quarterly life insurance policies.   I can’t get these much cheaper, but I should be able to next year.  The questions asked if I’ve smoked in the last three years, and that will be up on Halloween.
• AAA   – It’s only been recently that I’ve owned vehicles reliable enough to avoid paying my AAA dues for me.   I could cancel this, but for $80 per year, the hotel discounts make it a wash.  One vacation per year comes close to making the difference.
• Vehicle Registration – The only way to cut this would be to get rid of a vehicle.  I don’t think that’s possible for us.  We work in opposite directions and, for at least one quarter per year, spend too much time chasing around for activities.
• Daycare – We’ve been using our current daycare provider since my oldest(10) was one.   When my youngest turns 2 in June, our costs will go down.   Without one of us quitting our job, this bill can only go down as the kids grow up.
• City Bill – This bill combines our garbage, water, and sewer.   With three adults, three kids, and 5 animals in the house, reducing our garbage level is difficult.  We do try to manage our water usage in the summer, to keep that down.
• Web host – I have a few domain names and a hosting package to handle my side hustles and miscellaneous projects.    This is a deductible expense.  I have been allowing my domain names to expire if the project isn’t being actively pursued.
• Memberships – I have annual dues to two organizations.  I’m making payments on lifetime memberships, so these will be going away in about 18 months.

Reviewing this list, there doesn’t seem to be too much I can cut and accomplish any meaningful savings.  Am I missing something?

I’ve explained my budget in some detail already.  See these posts for the history of this series.

Now, I’m going to go through each section, reviewing ways that I can reduce, or have reduced, my spending.  I’ll be starting with my monthly payments.

• House Payment – I’ve mentioned that we have a small house payment.    A few years ago, when the interest rates dropped to almost the lowest point they reached in that particular cycle, we refinanced and got in under 5%.   There is nothing to cut.  We won’t refinance again, and the loan will be paid within 7 years, according to the lender’s schedule.  I’m aiming for 4 years.
• Netflix – We’re on the 2 DVD/unlimited plan for $13.99.  We could drop down to the single DVD plan, but I’m worried that will trigger a rash of movie-buying.  2-at-a-time scratches that itch well.  I don’t think we’ll be reducing this plan in the foreseeable future. [Read more…] about Budget Lesson, Part 5