We’ve all got bills to pay. If we hadn’t, we would have a lot more money left over at the end of the month. This sounds good!
But if we don’t pay our bills, we don’t have electricity. Or Internet. Or TV. Or Water. Or insurance. That doesn’t sound so good.
If only there was a middle way…? And there is!
We don’t often look critically at our fixed expenses, perhaps simply because we’ve become used to them, or because we don’t want to face reality. But it’s a healthy thing to do:Â shave your expenses and save a little every month – forever.
I’m reminded of this idea every once in a while, and it’s a neat little exercise to sit down and review my bills. This is easy to do because I already track all my expenses so I can quickly pull up a list of all regular bills I have to pay. Some of them are variable but necessary, like my water bill – I can’t do without the water service, and I can’t negotiate better rates. That one is just a fact of life.
Some bills are negotiable, and that’s where I can save money if I take a critical approach. I could cut the bill for cable TV (if I had any), I could pick a smaller cell phone plan, I could reduce the bandwidth of my Internet connection – these things would save money.
Of course there’s a limit to how far you’d want to reduce those services – Internet is no fun at prehistoric dial-upÂ modem speeds. The exact balance of expensive+great vs. cheap+bad is a very personal decision.
As a specific example, it often irks me that my cell phone plan is as expensive as it is: I pay more than â‚¬30 per month for 2GB of data + 1000 SMS + 600 minutes of calling. That sounds insane until I mention that those 600 minutes areÂ from anywhere in Europe, to anywhere in Europe! I don’t pay roaming fees when traveling, and more importantly, calling my family in other countries isÂ free.
Without that plan and just payingÂ regular international rates, I would pay anywhere between â‚¬100 and â‚¬300 per month, depending on carrier! Clearly this planÂ sounds like a bargain, but why don’t I simply use Skype instead? I could cut myÂ bill a whopping 70%!
Again, it’s a matter of personal style. In my case, Skype is not a realistic option because the people I want to call are not online on Skype very often, so I can’t get in touch with them as easily via Skype. To counter this argument, Skype offers Skype Out, a service that lets me call regular phone numbers from my Skype account. This is great if you don’t need it much, but I average around three hours of international calls every month and on that scale the ratesÂ cannot compete withÂ my cell phone plan.1)
So in the case of my cell phone plan, my periodic review of comparable rates confirm that my plan is actually the best I can get: even though it seemsÂ expensive, it’s actuallyÂ relatively cheap!
When did you last review your bills?Â When did you take a critical look at your insurances? At your electricity provider?
1) I’d love to use Google Hangouts for calling because their rates are a third of Skype’s and I could instantlyÂ cutÂ my phone bill in half, but unfortunately that service is not available in my country (yet).Â