Are you a planner or a procrastinator? If you consider yourself a procrastinator, it could take you much longer to become financially secure versus someone who is a planner.
Why is that? Procrastinators, or people who don’t plan ahead, are more likely to be hit by surprise bills, make impulsive purchases out of necessity, and lose control of their budget.
The secret to getting ahead financially is to plan for all your major expenses. This might sound overwhelming, but surprisingly it is just about as easy said as it is done.
Look ahead at your annual expenses and mark them on a calendar to keep track of wherever you may have to spend money. Not sure which annual expenses you have? Here are 5 specific situations where planning ahead will save you money.
1) Emergencies
As unfortunate as it might be, you should plan to have an emergency and save vigorously in anticipation. If a major emergency comes up, the last thing you want is to be insecure with your finances.
Failure to prepare for an emergency likely means that you put a car repair, medical expense, or surprise bill on your credit card or take out a loan. Either method is costing you major money in interest.
By planning ahead and expecting to have an emergency, you will save money on interest, plus give yourself peace of mind.
2) Insurance Costs
Did you know you may be able to save money on insurance costs by paying ahead in a lump sum versus paying monthly?
Look at your options for renter’s, homeowner’s, or car insurance to see if you are eligible for a discount by paying in a lump sum. Many insurance companies charge you a service fee for every payment you make, so by making only a few payments a year, you are able to save the service fee.
I personally pay my car insurance twice a year and save $80 by doing it in large payments versus monthly payments. In order to save for these large payments, I take what I would normally pay monthly for car insurance and put it into savings.
3) Holidays and Birthdays
It never fails that holidays and birthdays always seem to sneak up on everyone, though they are the same time every year. It happens to me, too!
Keep a pocket calendar in your wallet and keep gifts in mind while shopping throughout the year. You are more likely to find great deals on items that an individual would actually want, versus scrambling last minute to get your loved one something.
4) Groceries
Grocery shopping might not seem like a major expense, but it is one area where you can always save more money.
Procrastinators make several trips to the store during the week because they forgot to buy a certain item or didn’t plan out their meals adequately. Going to the grocery store spontaneously and without a plan is a huge money sucker.
Have you ever looked at what you buy when you forgot to plan versus what you buy when you do plan? Planning gets you so much more for your money!
Even worse, procrastinating on grocery shopping leaves you with an empty fridge. How many times have you gone out to eat instead of cooking at home for cheaper because your fridge was empty?
At the beginning of each week, take a look at your grocery store’s specials and plan out your weekly meals around that. Find coupons and make a list of items you need. Avoid impulsive sale purchases and you’ll be surprised how much money you save in a month.
5) Your Health
People tend to forget or underestimate how much it costs to stay healthy.
The cost of health insurance is rising, and unfortunately, there isn’t much you can do. Make sure you budget annually and expect increased costs.
Contribute as much as you can to your Health Savings Account (HSA). HSA’s roll over from year to year and utilize pre-tax dollars, so it makes sense to save for health expenses now.
Again, investing in your health and saving today means you will save yourself from having to spend extra money when a health issue arises.
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Planning ahead is a powerful tool to learn in order to achieve financial success. Organize your finances and always be saving and you’ll get ahead in your finances and avoid any surprises.
What major bills do you plan for? What are your methods for budgeting for this?
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Oh my yes, especially when it comes to insurance. I worked for a huge conglomerate insurance company in their dental department.
There were plenty of customers that I spoke to that needed critical dental procedures like crowns, but they couldn’t because the health insurance plan their company chose didn’t cover it and they didn’t have savings.
We’d offer various packages to companies and some companies instead of choosing mid-range or top dental insurance packages, would choose the cheapest and most spartan dental plans. This experience taught me a lot about saving for the unexpected. It was an eye opening job for me.
Insurance can be so overwhelming, so it really helps if you can see it first hand or study it. Definitely worth paying to be insured!
For the last few years, I’ve been putting away a regular sum of money each month for Christmas presents. When the holidays come around, I just have a big sum of money ready to be used. Everything that’s left over, I roll into into the next year. Really helps lessen the hit on the finances when the holidays roll around.
Great idea! Nothing is worse than trying to scrounge up the money for Christmas at last minute.
Absolutely agree, budget helped me to understand the importance of planning ahed, for example I noticed that I have an average of 2 birthday per month, sometimes more and sometimes nothing, but having a fund for birthdays helped me to be prepared, Ipay car insurance once per year now and I found a cheap but I’m saving a little amount monthly so I’ll be prepared to pay it on time…grocery too is importnt do a good mea planning and then see what already is in your house-cabinets, follow the list and use creativity to create new dishes, buying seasonal and local is important too!!!
It is SO incredibly important to save money ahead of time! All of the situations you have mentioned are all very good reasons to start saving now! One we would love to point out is saving for an emergency, No one can predict when an emergency is going to happen or how much money it will cost you, so that is why you should start saving right now after reading this article!! We really enjoyed reading this article!
If you don’t mind us sharing, we have an article that relates well with yours about financial planning for emergencies. We would really love it if you would check it out and share your opinions on it with us!
Here is the link:
http://bit.ly/2dxY0Nc