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Monday, October 10, 2011

2012 Planning - Housing, car and health expenses

OK, I'm starting with the big three that I have little control over without major life changes - which we aren't making for at least 6 years when hubby is planning to retire.  These are certainly three big expenses with housing being by far the largest expense category we have overall despite no longer having a mortgage. Together, but minus the cost of purchasing a car (a one time expense), these areas account for over 40% of our 2011 living expenses (excluding taxes and retirement savings).  They also seem to go up each year.

To me, housing expenses include insurance, property taxes, maintenance and improvements to the house and yard, home furnishings, and utilities.  In the utilities bucket I am including electricity, gas, water, sewer, trash service, and the home phone, internet, cable bundle.

We discussed our homeowner's insurance with our agent last year and kept it from increasing by changing to a different company.  I expect it will go up upon renewal though.  Our property tax millage rate went up 29% for 2011 and our home value stayed stable although virtually every other neighborhood in the county saw a large decrease in value.  We have filed an appeal on the appraisal and a neighbor has a court case underway.  We'll see about 2011 and start all this again in 2012.  Our phone/internet/cable contract comes up soon and our goal is to change services within reason to try to keep the cost stable. I'll work on all of this, but still expect it to be higher in 2012 although I don't know how much yet.  We aren't ready to do without a home phone and dropping cable would certainly decrease fun for us.

So on to the housing expenses where we have some degree of control.  We have no home improvement projects and no home furnishing purchases planned for 2012 (let's keep our HGTV demons under control please!).  This will be a matter of willpower since so much could be done to this old house.  Maintenance will include tree work as always and minor do-it-yourself stuff.  Something will break or there will be another tree that falls into our yard I imagine.  I hope it isn't anything big. 

Car expenses are the usual - insurance, registration, gas, maintenance and repairs.  We changed insurance in 2010 and helped keep our bill from increasing.   Otherwise, not much to impact.

In the health expenses category I include insurance, medical and dental fees, parking, prescriptions, glasses, over the counter medicines and vitamins, and Pilates sessions and possibly a gym membership in the winter.  I am sure that health insurance will go up, but it is through my husband's employer and provides very good coverage which we have used quite a lot.  Dental fees will continue to be high until June 2013 when orthodontist payments will be finished.  We will once again maximize our use of our pretax health savings account.  The other items are needed and/or add significant value to our lives.

Action StepsOnly a few that I can think of,  but here they are.  They are all savings oriented although my hope is to at best hold costs even with 2011 although I expect them to increase.

Housing - Keep to plan of no home improvements or new furnishings; maintenance of both only.  Otherwise continue strategies from last year - when insurance renewal time ask how to reduce cost, purchase lowest cost natural gas and phone/internet/cable contracts that meet needs, appeal 2012 property appraisal if appropriate .

Cars - Be diligent about tire pressure.  Continue to minimize unnecessary trips. When insurance renewal time ask how to reduce cost (e.g. would taking a safe driving course pay off?)

Health - Continue to maximize health savings account and shop for over the counter medicine sales.  In summer use up pool visits (exercise room also available) purchased in 2011.

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