Expenses Not to Cut

Isn’t it satisfying to slash costs? Finding ways to trim your budget is a great way to save money and feel in control when the economy isn’t. But before you get too “trim happy,” keep in mind that there are a few expenses not to cut. It may be tempting to skimp on these items, but they’ll cost you more in the long run.  

Car expenses. When your car is running smoothly, it’s hard to justify shelling out $35 for an oil change. But skimping on regular maintenance is like skimping on your healthcare (more on that later)—it could end up being a costly mistake. However, if your car was purchased in the last 10 years or so, it’s a myth that you need to change your oil every 3,000 miles. So while you shouldn’t slash this expenditure, you can probably get away with doing it less often. 

Car insurance is another bill to keep paying. Hopefully you’ll never need it, but if you do and your liability coverage isn’t there, you could find yourself in an avalanche of debt. But there are ways to lessen your bill: if you raise your deductible, your rate will drop. You may also want to consider dropping comprehensive and collision coverage only if your car is older and not worth much. Discuss options with your insurance agent for expert advice. 

Healthcare. Your health is vital—so healthcare is absolutely not a place to skimp. Even if you never use your insurance for a major illness or accident, you might. And that chance is reason enough to keep paying this bill. But remember that there are things you can do to keep healthcare costs down. Eat well, don’t smoke, exercise, and get regular check-ups. Preventative care can also prevent expenses down the road. Also, make sure to ask your doctor about generic medications and free samples if you end up needing a prescription. 

Debt. Skipping loan payments or paying only the minimum may be tempting when times are tight, but resist! You’ll never kick that debt if you don’t chip away at it religiously: the more time that passes before you pay it off, the more interest accrues. It’s quicksand—don’t step in it. 

Home maintenance. The do-it-yourself movement has saved Americans a fortune. Is your toilet running? Find a how-to video online. Are your windows drafty? Look up window insulation and fix the problem with your own two hands. But there are some DIY projects that—no matter how handy you are—you should leave to the pros. Electrical issues, for example, can be dangerous to fix yourself and potentially cause more damage. 

In general, consider each home maintenance issue on a case-by-case basis to decide if it really needs tackling and who should do it. Major flooding should be taken care of by a professional before it causes more expensive damage. A new paint job, however, you can do yourself when finances aren’t quite so tight. 

Home insurance. Just like health insurance and car insurance, home and renter’s insurance is hard to justify if you’ve never used it. What’s the point in shelling out money every month for seemingly nothing? If there’s major damage (flood, fire, etc.) and you don’t have insurance, you may lose your home and belongings completely. For most homeowners, their home is their largest asset, so losing it can be disastrous. Plus, if someone slips or trips and you’re liable, you don’t want that cost coming out of your pocket. Instead of skipping the insurance altogether, consider raising your deductible to save on your monthly bills. (This is an especially good tactic if you have enough savings to cover the difference if something major happens.) Another way to save on insurance is to find a carrier that gives you a discount for covering your home and your car. 

There are lots of ways to trim your budget: buy used clothes, read your newspaper online, take a “staycation,” don’t eat out. But when you’re finding ways to save, make sure they’re more than short-term fixes. Avoid cutting costs that may end up costing you in the long run.  

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