Week 3 of Budget 101

Part 3: Save on the Big Things

After spending the last week sorting out your budget and then recording all your purchases, you hopefully now have a fairly clear idea of where your money is going.  Over the next 6 weeks be sure to keep those worksheets handy–you will need to adjust your amounts as we work to lower expenses in the various categories.  Be sure to also continue recording all your purchases in the expense tracking worksheet too!
(NOTE: If you are new to “Through The Eyes Of I” or missed out last week, you might want to start at Week 1 of Budget 101 before starting this week’s assignment!)

This week we are going to tackle lowering the BIG 3:  Housing, Transportation, & Insurance.  I will readily admit that this is not my area of expertise.  Not even close. From this point forward it should be known that you are taking financial advice from a girl who thinks a cute pair of designer shoes or a great book is a perfectly reasonable investment, not just an impulse buy.

In other words, some of this stuff is a little over my head.

Since this kind of stuff overwhelms me, I’m guessing that it probably overwhelms many of you too. So let’s figure it out together and be better for it.  Luckily for us, the internet is a vast pool of knowledge.  This week, we’re going swimming.

I think the most important thing to keep in mind when it comes to your finances and the money you’re spending is this premise: Everything is negotiable.  

The great thing about NOT being socialists is that we live in a country where companies have to compete for OUR business. This is something they don’t really want you to figure out.  Most companies would rather have you believe that they are doing you a favor by financing your home or car, or providing insurance, because if you believe that, you’ll pay whatever they tell you to.  The truth is that they NEED your business, and that if they are not willing to negotiate, there is probably someone else out there who will.

Knowledge is power; use it to your advantage!

When it comes to saving money on your housing costs there are a lot of factors that will come in to play, far too many to get into specifics here.  Do you rent or own?  Do you owe more on your house than it’s worth?  Are you looking to buy?  Are you in an apartment? Is your lease coming due soon?  Your individual circumstances will determine your course of action, or even whether there is a course of action possible.

As far as transportation costs go, unless your vehicle is constantly in need of repair or way more expensive than you can afford, it is almost always more cost effective to stick with the car you have than get a different vehicle. Thus, your current car payment is probably not going to change much.  That said, if you need a new car, it is almost always better to buy used than to lease or buy something brand new. Your auto insurance, on the other hand, can definitely be negotiated!

Likewise, health, life, & home insurance prices can also be negotiated and shopping around pays.  When my Husband and I needed health insurance last year, we took a lot of time to price things out.  When we took into consideration how little we actually go to the doctor, we discovered that it made a lot more sense financially to buy only catastrophic coverage with a high deductable, then to pay a huge premium each month for medical coverage we weren’t using.  As with most things, it is very important to do the math!

How to negotiate when chartering a gulet

Here is your assignment:

1. Research options for lowering your mortgage payment or rent

Once you’ve done your homework, decide if making some changes or re-negotiating your rent or mortgage would be the right solution for your family.  I found some awesome, super informative, and, most importantly, short articles to start with:

How to Lower Your Mortgage Payment Without Refinancing (homeowners)

How to Negotiate Low Mortgage Interest Rates [Video] (homeowners)

I Owe More Than My House Is Worth (homeowners underwater)

How to get the best mortgage rate (looking to buy a home)

How to negotiate lower rent (renters)

Tips for Reducing your Insurance Premium

2. Research options for lowering your insurance rates

If you haven’t shopped around for auto, homeowners, health, or life insurance lately (or ever) then you need to.  Do some due diligence to find out what options are available, then make some phone calls (or send some emails) and get new quotes.  You might be surprised at how much money you can save.

 Here are some great articles I recently wrote to get you going:

What Every Mom Needs to Know About Insurance

9 Smart Ways to Save on Car Insurance

12 Smart Ways to Save on Home Insurance

It’s only two tasks, but this should be plenty to keep you busy this week!  If it seems daunting, just remember that every dollar saved on your mortgage, rent, vehicle, or insurance is a dollar that can be spent on shoes.
Stay tuned for another riveting installment next Sunday and don’t forget to let me know how you’re doing! What big things do you want to save money on?  Do you think it will be possible?  What is something you know you can’t save on?
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Don’t Sign That Lease Yet

When looking for a living rental, whether being an apartment, loft or house; you may have a lot lingering in your head such as, questions, expectations, plans and maybe even excitement or stress. Perhaps you’re excited about turning your new place into a home and decorate (which is my favorite), or you are nervous about your move. No matter what your situation, when shopping for living rentals, the most important thing you must do is to thoroughly study your lease before signing it. Aside from reviewing the lease, always ask your landlord or apartment manager questions about renting, or about any other aspect of life in your perspective new dwelling. He or she should be helpful and must address all your queries, and more importantly, put what you’ve discussed into writing in case you have to return back to it for reference. Whatever you do, always read your lease, and don’t adjourn it for after you sign it.

Image result for read lease first

So, what are some important questions to ask when looking at rentals before signing a lease???

  • How much is the rent?
    • Questions about rent cost are very basic yet very crucial, as the apartment must fit your budget of course. You may be able to even negotiate a change in the rents price, but some landlords are settled for what they want to rent their property for. Keep in mind that it may send a red flag that you may have difficulties in paying your rent if you ask to lower the price.
  • When is the rent due?
    • Usually rent is due on the first of every month, but it may be different due to your move in date. Sometimes an extension is available, so ask if there is one, and if there is interest or a fee attached to your late payment.
  • What is the length of the lease?
    • Some leases are month to month, every half year or yearly. If you are renting a room, a lease is normally weekly, bi-weekly, monthly or yearly. It is also important to be aware of what happens when your lease is up since some landlords do renew the lease, and some may just void it and allow the tenant to stay as long as they continue to pay their rent.
  • Under what circumstances can I break the lease?
    • Some landlords allow their tenants to break their lease once they prove that they have been relocated for work or have purchased a house, keep in mind that not all do. Some landlords or agencies may even allow you to break your lease due do crime such as a burglary. A few years ago, my apartment was robbed while I was at school, and my landlord allowed me to break my year lease since I was worried I may be targeted again because I was barely home and lived by myself. Leases can also be broken if the landlord does not keep their end of the bargain as well.
  • Which utilities am I responsible for?
    • Utilities make a big impact in apartment costs, so be sure to gather as much information about them as possible. If you are responsible for electricity, heat, trash and/or water, you want to make sure you can afford those payments within your budget. If utilities are included, you should know if there are any limitations. Some places have a set thermostat with a limit temperature and timer included when heat is included.
  • What is the cost of the utilities for the apartment I would like to rent?
    • To help budget your cost, ask the property owner what is the normal monthly rate for utilities. If he or he is unaware, you have the ability to call your local utility companies, and request an estimate based upon the past usage of previous tenants.

Image result for utility cost

  • Is the heating electric or gas?
    • Generally it is cheaper to heat water with gas than with electric. Electricity costs about four times as much as natural gas for the same amount of heat. If a dwelling is heated by electricity, it’s especially important to call the utility company to find out about past electric bills at that address.
  • Who is responsible for hot water?
    • Sometimes the landlord pays for hot water, and sometimes tenants pay. Hot water is often the second biggest part of your utility bill, so it’s important to ask this question before renting. Again, call the utility company to find out what past gas and electric bills have been for that address.
  • Am I provided with cable, satellite service or internet?
    • Some places include internet with a monthly limit of GB usage while cable may only include only certain channels.
  • Who is in charge of yard work?
    • Some rentals include yard work such as snow plowing, and mowing of grass as well as bush trimming in the rent. Not all rentals include these services and it is the tenants responsibility to care for the properties yard. My rent includes all yard work, except my own personal gardening of course 🙂

Image result for street parking signs

  • What is the parking situation?
    • This is a very important question if you own a car. Check if you will be provided with your own parking spot, and ask whether your guests can use other parking spaces when they visit your place. If there are no off street parking spaces available, it’s good to know where parking on the street is available, the distance from there to your dwelling, as well as the city/town laws in regard to parking on the street. Some cities have alternating parking days while others may not.
  • Can I make improvements in the apartment?
    • We sometimes may not like how the sink or shower spits out water, and may want to change faucets. Check and see if there is anything in the dwelling that you would like to have changed, and see if you can change it. Some landlords may even deduct from your rent if you show proof of cost for your efforts.
  • Can I re-paint or hang décor?
    • This is important as well. You might have found the perfect location, but what if its walls are painted in a dreadful color? Some landlords will allow you to re-paint while others won’t. Some rentals also will not allow to have anything hanging on the walls due to the potential damage from drilling holes or hammering nails. Details about redesigning should be included in the lease.
  • Is there a lot of noise? Are there rules to noise?
    • If noise is a huge issue for you, you better make sure you know if other tenants or neighbors make a lot of it. If you are one who creates the noise, ask what are the limits, and if it will be a problem. You have to show neighbors respect no matter where you move. Having company shouldn’t be an issue, but when it’s loud company, it can be.
  • Can I have pets?
    • Ask about the pet policies. Each place will have its own set of rules and regulations about pet ownership. Some will allow pets while others won’t. Some communities are very particular and will even look into a pet’s breed type and weight. Additional security deposits may apply for your pet, and you should be aware, just as the landlord should be aware of your pet’s presence.
  • Can I sublease?
    • In some rentals, you will be allowed to take in a roommate or perhaps, add another name to the lease after moving in. Make sure this option is available in case you are in need for the extra help with expenses or just want to help out a family or friend.

When looking at rentals and asking questions, try to think in both the long and short term. There are lots of rentals out there, and asking the right questions is key to choosing the best one for you.

Samantha Jonas-Rongo