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American Family Budget: Can I Reduce Our Bills?

It’s time for an audit.

No need to panic. I don’t mean an IRS audit — believe me, those are a big pain. I know. I’ve been there.

In this case I’d like a mock independent audit of our fixed monthly costs.

As the family budget captain since the day I got married, I have long been aware of just how much money we spend on utilities, internet, cable, insurance, etc. But while we were overhauling our expenses and adjusting to the written monthly budget, I stuck my head in the sand about those amounts.

It was exhausting enough to learn to watch every penny of our discretionary funds. The last thing I needed during that process was to overwhelm myself with more numbers by shopping around to change TV service or auto insurance.

But I’m ready now.

I’ve had a nagging sensation growing over the last few months. As I dutifully plugged our grocery totals into the spreadsheet and prided myself for staying within the budget (or forgiving myself when I didn’t), I finally started to pay attention to how much money we spend on phone, TV, and other recurring monthly bills. And boy, do we have some explaining to do, hence my wish for an audit.

I like the ring of the word “audit” because to me it feels serious, like an accountant is coming to my house to scrutinize our line items and say “Do you really need 200 U-verse channels?” with arched eyebrows. My actual real-life accountant friend who conducted audits for enormous companies says I do not think that word means what you think it means.

“What you are really referring to is a Budget Review where you are reviewing how you derived your budget,” she said. “Or you mean an analysis of your Budget to Actual where you compare what you actually spent versus what you budgeted. Both procedures are useful. In the first you take a hard look at what you plan to spend and decide if you really need to spend those amounts. In the second you compare your actual spending to see if you are on target and what future adjustments you can make.”

Okay fine, tomato tomahto. What I want to do is a combination of those efforts: look at what I spend on wireless phone service, for example, ($129 per month) and see if I can reduce that bill by negotiating with my current carrier (AT&T) or switching to a new one. Since I’m not going to hire someone else to come and do this, my “independent auditor” is just going to be…me.

Here are the categories I plan to tackle in the next few weeks:

Car insurance: Since March our payment went from $138/month to $157/month. What’s up with that?

Home insurance: We just paid $1,726 for an annual policy, up from $1537 in 2012. That works out to $144 per month. Wondering if we can bundle this with a new auto policy and save.

TV/Internet: This bill has averaged $145 since March, and I think some kind of temporary discount I agreed to last year runs out this September. But I don’t quite remember, because like I said, my head was in the sand. The thought of changing all this makes me sick to my stomach; every time we have switched providers our systems have been down for days and it takes a while to get used to the new one. This is my least favorite task, so I may tackle this one last.

Electricity: It gets pretty hot in our area during the late summer months, so our electric bill got up to $180 last September. We do our best to conserve but I am sure we can do more. Our provider (Southern California Edison) offers a bill credit if we sign up for automatic AC shutdowns, which I am going to investigate. We can always go to the beach when that happens.

Telephone: We pay about $156 in phone bills every month – $130 for my cell phone and $27 for our land line (up from $22 a year ago). For the land line we use an old-school handset that does not require electricity and I had it installed in case of emergency. I believe the bill went up because of taxes, but it wouldn’t hurt to investigate. My wireless bill is for unlimited talk, text, and data on my mobile phone. Since I am actively trying to disconnect from the internet while I am not working or writing, I really won’t need all that data. A new, cheaper plan is a good idea.

Well. When I list it out like that, the project doesn’t seem so daunting. The worst than can happen is that I’ll do a bunch of research and get nowhere. The best? I’ll shave some dollars off the monthly budget that we can use to restore our “savings” category. This should be interesting.