Storage units
There are very few good reasons to rent a storage unit, especially long-term. The monthly cost of $50 to $200 per month ($600 to $2,400 per year!) could remain in your bank account and be used for home repairs, retirement or investing. If you’re paying to store old furniture or things you might use “someday”, ditch it now and save yourself hundreds or even thousands of dollars. Have a yard sale, sell it on Craigslist or give it away, your bank account will thank you.
Expensive cleaning products
It’s not necessary to buy name-brand cleaning products when you can easily replace most of them with a bottle of vinegar and a box of baking soda. These two products can be used alone, together and mixed with water to clean glass, toilets, tubs, tiles, ovens and drains. Add a little dish soap for degreasing or lemon juice for additional cleaning power. If making your own products isn’t appealing, shop around for the lowest prices on comparable cleaners.
Brand-name single-use items
Single-use items offer convenience, but don’t pay top dollar for a product you’ll literally use once and throw away. Try to find the sweet spot between affordability and function. Don’t buy the cheapest paper towels that tear easily and aren’t as absorbent. Instead, opt for mid-priced paper towels that perform better. “Paper products don’t have to be bought at a premium,” Donikian says. “Store brands are just as good.” The same goes for other single-use items like disinfecting wipes, garbage bags, paper plates and toilet paper.
Too much insurance
One of the fastest-rising costs of homeownership is insurance, but there are ways to lower it. Croak suggests looking at your dwelling coverage for cost savings. “The problem is most home owners insure their house for market-value which includes land. If your land is worth $90,000 of that $400,000 home, then you’re paying monthly premiums to insure land. Lowering that amount as close to rebuilding cost as you comfortably can will reduce your annual premium by $200 to $500,” he says. Raise your deductible to $1,500 for additional savings.
Brand new “cheap” furniture
Furniture should be made to last, if not generations, at least one generation. Avoid the temptation to buy inexpensive boxed furniture, as it will cost you in the long run when it needs to be replaced every few years. Instead, consider furnishing your home with solid wood or at least high-quality store bought furniture. Look on-line for gently used furniture, check thrift stores or frequent estate sales for some real cost savings, and the opportunity to find unique pieces.
Home and holiday decor
“The easiest place to cut expenses from is home decor, gifts and holiday decor,” Schneider says. “These are nice-to-haves, not necessities.” Resist the belief that you need tons of home decor that rotates each season. If you love holiday decor, minimal decorations can be just as nice or try working within a strict budget. Again, second hand is a great way to purchase home decor and holiday decorations. Both are often lightly used and can be picked up for much less than retail.
Expensive organizing systems
Buying more bins, shelves and containers to organize all your stuff may be missing the point. Instead, do a deep decluttering of your things (try one room or closet at a time), to donate, up cycle and throw out, anything you truly don’t need. You not only free yourself from the overwhelm of too much stuff, but save yourself the time and money of storing things you rarely, if ever, use in expensive storage systems.
Home warranties
The idea of home warranties is very alluring: when major home systems or appliances fail, the home warranty company will take care of the cost. While a nice idea, the reality is much different. “Many consumers believe that they are protected by warranties,” Donikian says. “However, there are a ton of exclusions and limitations that reduce the warranty’s benefit.” Instead, establish an emergency repair fund.
Professional repair and maintenance services
The cost of hiring professionals to complete home repairs and maintenance tasks is also on the rise. Try tackling small projects yourself for real cost savings. Start with low stakes projects like drywall repairs, painting and lawn care to build your confidence and tool collection over time. “You would be surprised at what you can do by yourself after watching a few YouTube how-to videos,” Donikian says.
Smart home service
Once you buy and install smart home devices, often the cost doesn’t end there. Many device manufacturers offer subscription services for cloud storage, video retention or maintenance. It’s these small, hidden fees that can add up over time. “Before you know it, you’re paying four or five different fees just to utilize devices that you already purchased once,” Croak says, which can add up to hundreds of dollars each year. “Purchase equipment that has local storage capability instead, then decline every subscription service offered for hardware you’re already paying upfront for,” he adds.
About the Experts
- Eric Croak is a wealth management and investment fiduciary advisor and President of Croak Capital.
- AJ Schneider is a financial coach and founder of Beyond the Green Coaching, a values-driven financial education company.
- John Donikian is a home financing loan officer and vice president of Best Interest Financial in Detroit, Michigan.
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