Reduce Living Expenses
Save on Miscellaneous Expenses

(Last updated: June 5, 2017)

This page shows how to save money by reducing your miscellaneous expenses. The miscellaneous expenses described in the topics below can be significant for many people. By reducing these expenses, you can have more money for other things.

These suggestions are offered for your consideration. Perhaps they can guide you to a better life style. But the final choices are up to you.

Here are the topics:

Child care expenses
Financial expenses
Gifts and donations
Income taxes
Life insurance
Personal grooming

In order to reduce these miscellaneous expenses you may have to do some planning and change some of your habits and preferences. Whether the money you can save is worth the effort is up to you.


Before using this information to reduce your living expenses be sure to read the following notice: Disclaimer.

Child care expenses

Child care can be very expensive. It might even be a significant portion of the income you earn by working away from home. (However, having this expense might reduce your income tax.)

See if some of the following ideas can reduce or eliminate this expense.

You might try getting a roommate who has children and works a different shift than you do. Then you can trade off babysitting duties with each other.

Maybe you have relatives who live close by and wouldn't mind babysitting, especially if you pay them some money.

Another way to save on child care expense would be to find some legitimate work at home job. See the Start a Business Working at Home page for ideas.

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Financial expenses

Bank account -- If your current checking account charges a monthly service fee, see if you qualify for a "no fees" checking account. (Some credit unions might offer this type of checking account.)

Credit cards -- Let's say you have credit available on a low interest rate credit card. You may want to transfer some or all of the balance from a high interest rate credit card to it.

Ask your credit card company to lower the interest rate they charge you. However you need to be a good customer with a high credit rating to pull this off. (Keep in mind though that some credit card companies are in a mood to cancel some or all of their accounts.)

You can reduce the interest expense on your credit cards by stopping all new charges and paying $10 or $20 more than the minimum required payment.

Improving your credit rating -- When you are trying to get lower payments on a loan or get a lower interest rate on a loan or credit card, it helps to have a good credit rating. Here are some tips to help improve your credit rating:

Pay your bills, credit cards, and loans on time. Pay more than the minimum amount required on your credit cards. If you can't make a certain payment on time, talk things over with your creditor. Don't just let things slide.

Don't run your credit cards up to the limit. This indicates that you can't control your spending and therefore might not be able to make the payments in the future.

Limit the number of credit cards and other loans you apply for and use. Growing debt indicates that you can't control your spending and thus may not be a good credit risk.

It looks better on your credit report that you get loans from a bank or credit union, rather than from a finance company.

Personal loans -- There are many reasons that people go into debt, besides buying an auto or a house. You might owe on student loans, hospital bills, and so on. But once you owe on a personal loan, you probably would like to lower the monthly payments. This means getting a lower interest rate or extending the term of the loan.

If you have a good credit rating you may be able to consolidate your personal loans into a home equity loan. Maybe you can refinance the loans through your local credit union.

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Gifts and donations

Our family has kept growing over the years, making Christmas gift giving very expensive. So now we only give to our immediate family. For nieces and nephews we draw names and only give to the selected person.

I used to give to almost any charitable organization that telephoned me. After discovering how much of the money goes to the solicitors, I have changed. Now I just tell them that I'm retired. Then I hang up the phone. (Charity begins at home.)

If you want to help society you can volunteer your services at a local hospital or charity. You don't have to spend money.

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Income taxes

In the United States individuals may be subject to both a federal income tax and (in most states) a state income tax. There is even a city income tax for individuals in New York City. However, low-income people may not be subject to income tax expense. In some cases they even may get a federal income tax refund, as from the Earned Income Credit.

Most individuals are on a cash basis for income tax purposes. This means that you report income when you receive it, rather than when you earn it. And you claim deductions when you pay them, rather than when you owe them. So you have the ability, to a certain extent, to shift income and deductions between the current year and the following year.

Some people try to decrease taxable income in what otherwise would be a high income year, and increase taxable income in what otherwise would be a low income year. This practice will often reduce their overall income tax expense.

Other people just want to reduce their taxable income for the current year. The following discussion is meant for these people:

Defer receiving income until the following year, although it was earned in the current year. (An example would be a commission you have earned.)

Pay deductions in the current year, although they are not due until the following year. (An example would be a mortgage payment, if you are able to deduct mortgage interest expense.)

If you have a paper loss on stocks or bonds sell them or establish that they are worthless before the year end. Then you will get the capital loss deduction for the current year. This will reduce any capital gains you have. Any leftover capital losses can be used to reduce a certain amount of ordinary income.

See your income tax advisor for details on these matters.

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Life insurance

There are two basic types of life insurance -- term insurance and whole life. Term insurance just covers you for a certain period of time. Whole life insurance is primarily a tax-sheltered investment. It builds up a cash value as you keep making payments.

Term insurance is less expensive than whole life insurance. But at the end of the term the insurance expires and it doesn't have any cash value. In my opinion, term insurance is best when you are raising a family and struggling to make a living.

Whole life insurance is more expensive than term insurance. It is similar to a pension plan in that the earnings build up tax-free. You also may be able to get a loan against the cash value of the insurance policy. In my opinion, whole life insurance is best when you are earning a good living or are concerned about income tax planning.

Universal life insurance combines the advantages of both term insurance and whole life insurance. Premium payments above the cost of the term insurance are added to the cash value.

If your primary goal is to save money on life insurance, then term insurance or universal life insurance is the best buy.

The following websitecan help you will choose the best insurance policy:

IntelliQuote -- Compare life insurance rates online.

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Personal grooming

Going to a barbershop, beauty shop, or nails salon can become expensive over a year's time. To save money you can either cut back on how often you visit these places or get the grooming done at home.

Perhaps you and your family or friends can get together and do the grooming on each other.

If you have a barber college or beauty college in your town, you will pay less to have a student perform the service.

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Pets can be expensive to maintain. There is the pet food of course. Perhaps trips to a veterinary will be required. If your pet get injured the expenses could really add up. (But if you decide to give up your pets, find a good home for them. Don't just drop them off in a back alley somewhere.)

On the plus side pets can be a companion in an otherwise lonely life. And children often enjoy playing with pets. People with pets often live longer because it gives them a purpose in life and a great deal of enjoyment. The choice is up to you.

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