When your major life expenses—mortgage, college, building a nest egg—are behind you, you can think about letting your life insurance lapse. If something happened to your spouse, would you be OK without a payout? Think about it this way: Could you invest your capital at a guaranteed rate of return, add that amount to any future income and have enough to live on? If so, you can stop paying for the policy. If it’s not quite enough, think about buying less coverage.
Head to the Web site of your power company and see if it offers an energy audit. This is a process in which a representative goes through your home to show you where you’re losing energy and how to fix it; they also check out the efficiency of your heating and cooling systems and suggest ways you can conserve hot water or electricity. If you don’t go for the bigger fixes (like new windows), the less expensive ones (like caulking your old ones) typically enable you to make up the cost of the audit in a month or so.
Or you can do it yourself using the tips at energystar.gov. The site offers a home energy yardstick, which will help you figure out the degree to which you’re overspending. In some areas, you can also save by agreeing to a restricted use of power during times of high energy usage. (These load management programs vary by company, but many give you a discount for a limited number of months, say, June to September.) The power company will install a programmable thermostat, then, if there’s a crisis, it may turn off your air conditioner from a remote location for a few hours. Savings: from $60 to $200 a year.
Play hardball with your communications provider
You probably already know that you can save by purchasing phone, Internet and cable from a single vendor. You can also save by threatening to take all of that business to another company. I employed this strategy when Verizon came to my town—and knocked $60 a month off my Cable-vision bills for the next six months. Also, look around the house for communication redundancies. Do you need DVRs on every set? Also, how often do you use that landline? Nearly 20 percent of American homeowners have already dropped theirs.
Reevaluate your automatic debits
Ordinarily I’m a big fan of putting bills on autopilot. But sometimes when we have money zapped out of our accounts automatically, we forget how much we’re spending. So it’s time to take another look at the health club, Netflix and the credit monitoring service. You can put a fraud alert on your card for no fee simply by calling one of the three major credit bureaus and asking. (They’ll share the information.)
Finally, stay focused
One problem with cutting expenses is that people devote time to the challenge for a month or so, then stop. It’s important to consider this a work in progress. One way to keep your outlook positive is to track how much you’re saving. The $100 you knocked off your insurance bills, plus the $65 that you’ve trimmed from the heating bills, plus the $115 a month that you’re no longer paying in interest to your creditors? That’s $1,545 a year—real money.
So what do you get when you’ve slashed this and cut that? Allow me to answer that question with a story. My pal Fran Rubel Kuzui, who in her former life helped create Buffy the Vampire Slayer and now runs a yoga studio in Japan, was seated on a recent flight next to an executive from a luxury accessories label. He was wringing his hands over the fact that the $1,000 handbag is no longer the “it” item. “I don’t think there is an ‘it’ item anymore,” he lamented. “Oh, but you’re wrong,” Fran said. “It’s called peace of mind.”
Jean Chatzky is More’s finance columnist and the author of several books. Read more of her advice here.