This post is part of the CCC Personal Finance Guest Blogging Contest. If you like it, please help the author by tweeting it, liking it, leaving a comment and voting for it using the social buttons at the end of the post.
In this day and age all live busy lives. We rush from one thing to the next. We go to work, we have social engagements, kids need to go to sports practice and every once in a while we need to take some time to relax.
With the fast pace of life it can be extremely hard to stay on top of your personal financial situation, and far too often important things like how much we're paying for insurance or cable TV can become an afterthought. Because of that we often end up paying hundreds, or even thousands more every year for things than we need to.
Take A Vacation Day To Fix Your Finances
Because it can be so easy to just let things slide, and keep pushing off taking the time to fix your finances, I suggest taking a day every year to sit down, do the math, and find ways to save big money. On that "personal money day" you just look for things in your life that aren’t optimized, and you do your best to improve them. Call around to get better rates on your insurance, find higher interest rates for your savings, re-balance your portfolio, find a lower interest credit card, switch TV providers, or just set up a budget if you've never done one.
So where do you start?
In The Beginning, Focus On Big Dollar Items
A lot of people decide to make a weekend day a personal finance day, but I prefer to take a day off during the week because you may need to call a place of business to get details or a quote, and doing it during business hours will most likely work better. I find it also puts a bit more pressure on you to get things done because you’re taking a vacation day, and you don't want to waste that do you?
So where in your financial life should you start looking for savings when you've decided to take a vacation day, and fix your finances? Personally I like to focus on bigger ticket items first, to help maximize my returns.
Some of the things I might try to look at on my day off:
- Insurance: If you haven't purchased insurance already, make sure that you have homeowners, health, auto, life, disability and any other types of insurance that you need. If you've been putting off getting insurance, do it today! If you’ve already got coverage consider switching to get better rates - or if you have OK rates already, consider dropping un-needed coverage or reducing deductibles to save money.
- Checking and savings accounts: Close accounts that have fees associated with them, and open accounts with higher interest yields and rewards.
- Credit cards: If your cards have a balance, try finding a card with a lower interest rate. If you have a rewards card, cash in any rewards you may have earned. Research benefits of different cards.
- Create a budget: If you don't have a budget, today would be a good day to set one up. Set up a plan to get out of debt, and save.
- Plan for retirement: If your allocations have gotten off, consider re-balancing your portfolio. If you don’t have a retirement account, consider opening one.
- Cut costs on utilities and services: Cancel cable or satellite TV and sign up for a cheaper alternative, or watch TV for free via your computer. Look into cheaper home phone and cell phone alternatives.
- Cancel services you don’t need: Signed up for cable TV but you don’t watch? Have a gym membership, but don’t go? Cancel the un-necessary expenses!
My Day Off To Fix Our Finances
I took a personal day a while back where I decided to focus on several big ticket items, mainly insurance and savings accounts. I submitted my information through a variety of sites to get quotes on insurance rates for our cars. I found we were overpaying to the tune of almost $1100!
Next I looked at our homeowners insurance, and submitted quotes for the same coverage that we currently had. I found that we were overpaying on that by almost $200 when all of the quotes had come in!
Next I looked at our savings account that we had at our local bank. There was no interest being earned on that account for the most part. I found a variety of alternatives, and found one that would increase our earnings by a few hundred dollars a year.
By taking one day off my family ended up saving almost $1500.
Conclusion
While my personal finance day results were pretty good, I'll bet that they're pretty typical of what people could find if they just looked. Far too often people just sign up for services or insurance, and then just let them continue on in perpetuity. If they would just take the time to do the research, they would most likely find hundreds of dollars in savings for their family - all for comparable coverage or services.
So the question is now, when are you taking your personal finance day off?
This is a guest post by personal finance blogger Peter from Bible Money Matters. You can find him most days on twitter at @moneymatters
This is such a great idea. There are always money-related things on my to-do list — look at how the market has changed our asset allocation, automate more of our finances, check out this online tool or that. To set aside a day each year to knock them all out makes a lot of sense.
Thanks, I appreciate it. I got the idea from a friend a while back, and I liked the idea so much I tried it for myself. I highly recommend it!
My wife always suggested this to me, and I finally did it recently. Although, it wasn’t about saving money for us…just getting things in order. I think we are due for another finance day soon!
That is another great side-effect — that you get things in order and back on track. If you can save money doing it like I did as well, that’s just a bonus!
I’ve definitely found that with everything that goes on in life it’s hard to pay attention to all of out finances. Taking a good block of time to concentrate on issues is definitely helpful!
I’m not sure I would get things back on track unless i took a big chunk of time like this..
Hi Peter, this is really sound advice. There is good reason to take the time to set your financial plan in motion.
And it’s so funny that I feel like I’m in a commercial when I say – “I saved 60% on my car insurance by switching to Geigo” – but so it’s true! LOL!
My bank is starting to charge fees for some really simple things on my checking account that I don’t even remember signing up for – like suddenly they are sending copies of my cancelled checks instead of the original. At first I didn’t mind. Later I noticed they are charging me $2 per month for this! So you’re right there too, I think it’s time to look for a new bank.
I enjoyed reading this post, nicely done. Best wishes in the contest.
Thanks, I appreciate it! My bank is starting to get a little funny with me too, starting to charge fees for things they didn’t used to. I’ll be having another one of these financial days off soon to focus on getting a new checking.
I’ve found it takes me four hours to rework our yearly budget. We have very few big challenges otherwise, and the few times we’ve checked for cheaper alternatives (insurance, internet) we’ve found what we have stacks up well.
Focusing your “Money Day” efforts on two-three areas is probably the best way to go. Cramming the total makeover into one day would be a killer. Once the big things are in place, occassional maintenance is all that’s needed.
I agree that it can be a killer day if you try to do it all. That’s why I mainly focused on insurance and savings accounts when I did mine, and I plan on doing another one in a few weeks to focus on checking accounts, and other monthly bills to see where I can save.
I really enjoyed the post. Taking a personal day off during the week to fix our finances sounds like a great idea! I agree, during the week would be more productive for me than the weekend. Thanks for the idea!
Thanks for commenting, Yeah, i just found the added pressure of taking that day off was helpful for me to keep me focused on the task at hand. Otherwise,it’s easy to get sidetracked if I do it on the weekend.
Not my idea of a perfect vacation, but a good idea.
Sometimes you need to set aside a specific day or time to just get something done.
Nice post.
Yeah, maybe not as enjoyable as a day at the lake, but it definitely means you need to make it worth your while. Sometimes that might be what it takes to get these things done.
I guess taking one day off to focus on something which affects our lives 365 days a year is worth it and can make a big difference in our future. Great practical tips!
I definitely think it’s worth it. Look at how much I saved, over $1000/year! I’ll bet others could save just about as much.
I love it. These days with all of the automatic transfers and account setups, it takes a day…I think we need a week actually.
No kidding.although i’m not sure many people would want to take a “personal finance week”, myself included. heh.