Money management in the final quarter

October 17, 2008 12:16:01 PM PDT
Joan Jensen, president and CEO of the Central Credit Union of Illinois, visits ABC7 Chicago.Even in the best of economic times, the last three months of each year are notorious for placing enormous strain on family and personal finances. Now more than ever, the checkbook is being whittled away by everything from rising energy costs and mortgage payments to healthcare and gifts and through it all everyone is looking for ways to save. And although there is little we can do to reign in the spiraling costs of goods and services there are some steps that can be taken to trim monthly expenses.

There are multiple approaches to reducing expenses and many are so simple that they are often overlooked. But if you know where to look the opportunities are plentiful. Joan Jensen, president and CEO of the Central Credit Union of Illinois is here to tell us about some surefire way to identify and tap potential savings to reduce your monthly expenses.

INCREASE DEDUCTIBLES - According to the Insurance Information Institute, raising your auto deductible to $500 typically cuts the premium by 10 or 15 percent; going to $1,000 can save you as much as 30 percent. Increasing your homeowner's deductible up to $1,000 can add to that savings by a whopping 25 percent. Some insurance companies will reduce your premium by another 5 to 15 percent if you buy two or more insurance policies from them. Before making any changes, first make certain the combined premium price is lower than if you were to buy the policies from separate companies.

THINK BEFORE FILING A CLAIM - Think twice before filing a claim for less than twice the amount of your deductible. In general, an insurer will increase a premium by specific percentages for each chargeable claim made against your policy above a specific dollar amount. A chargeable claim is one the insurer considers primarily your fault. The percentages vary from company to company and the increases can stay on your premium for three years following the claim.

NEGOTIATE EVERYTHING - The rules change in challenging economic times. A tried and true method for obtaining greater value and money savings money is to haggle - everything is negotiable. Be aggressive, ask for lower purchase prices on the goods and service you use including lower interest rates on credit cards and extended warranties on appliances. Request cash payment and bulk purchase discounts and if you are in the market to buy a new car, ask that free gas and regular oil changes be included in the deal.

ASK THE DOCTOR - the pharmacists, your company's benefit's manager and other health professional about creative ways to reduce the costs of healthcare services and medicines. Similar to auto and home, real savings can be achieved by increasing deductibles. Also, leading pharmacy chains like Walgreens and others offer generics at discounts and house-brand products (asprine and crèmes) reduced by up to 10 percent. Lastly, ask your physician if splitting pills (dividing one pill into 2 or more) is possible for your type medications. You r savings could be 50 percent of more and many if not most pharmacists will split the pills for you. However, if that service is not available, you can always purchase a simple devise to divide your meds on the open market.

JOIN A CLUB - Consider joining prescription savings clubs, which offer great discounts for small yearly fees. Many of these programs offered by outlets like Walgreens and CVS even include discounts for the family pet.

SHOP SMART - The National Retail Federation projects that retail sales will increase less this year than at anytime over the past 10 years and stores are reacting by offering up deep discount far earlier than normal. The sooner you get started the more time (and paychecks) you'll have to cover the expenses. Remember though, the best gifts are not necessarily those bought. Sometimes a lift to the doctor's office, a donation to a local food bank or a homemade gift can be the most treasured offering of the season.