Key ideas

1. A bill cut once saves money every month. Lowering a bill by $30 is worth $360 a year. That beats skipping a lot of coffees.
2. Start with the biggest bills you can shop. Car insurance, phone and internet usually have the most room. Compare prices before you call so you can ask for a match.
3. Move the savings before you spend it. Raise your automatic savings transfer by the amount you cut, or the money quietly turns into extra spending.

Vocabulary

Insurance deductible

The amount you pay yourself on a covered loss or medical bill before your insurance starts to pay.

Emergency fund

Cash set aside only for surprises like a job loss, a car repair or a medical bill. A common goal is 3 to 6 months of essential costs.

Work it out

Dee, 32, rents with a roommate and drives to work. Her phone, car insurance, internet and streaming bills add up to $370 a month. She spends one Saturday afternoon working through them.

1. Phone: $85 to $30 prepaid plan
2. Car insurance: new quote
3. Internet: lower speed tier
4. Streaming: keep 1 of 3
5. Saved each month
6. Months in a year
7. Saved in a year ($137 × 12)

Check yourself

1. You cut your internet bill by $25 a month. How much is that over a year?

   • A. $250
   • B. $300
   • C. $125
   • D. $600

2. What should you have ready before calling to lower a bill?

   • A. A complaint about past service
   • B. Your full credit report
   • C. A competing price for the same service
   • D. A plan to cancel all your services

3. When does raising your insurance deductible make sense?

   • A. When your emergency fund could cover the higher deductible
   • B. Always, since it lowers the premium
   • C. Only if you have never filed a claim
   • D. Never, since deductibles can't change

Your turn

Open your last bank and card statements and list every charge that repeats. Cancel one subscription you haven't used this month, and get one new car or renters insurance quote with the same coverage you have now.