12 Monthly Payments You Should Add -- or Drop

US News

Monthly costs can proliferate like bedbugs and be just as hard to purge. While some monthly expenses appeal to a frugal sensibility -- you might score discounts by signing up for regular deliveries of household staples through an Amazon subscription, for example -- there are also plenty of regularly incurring costs that might seem like they'll save you money but actually do just the opposite.

We turned to our resident frugal experts and contributors to the U.S. News Frugal Shopper blog to solicit their advice for monthly costs that you should run away from, and which ones you should invite into your life.

Monthly costs to keep:

1. High-quality groceries . Stefanie O'Connell, who blogs at thebrokeandbeautifullife.com, says one thing she will not skimp on is good food. That means she'll buy fresh vegetables and fruit instead of opting for cheaper frozen meals or processed food. "When I go to the store, my cart looks like I just took a stroll through an organic garden rather than a midtown grocery," she says. The payoff, she adds, is looking good and feeling good, which is priceless.

[See: 10 Surprising Facts About Modern Consumers.]

2. A bike rental membership. O'Connell, who lives in New York, pays about $8.50 each month for a membership to a New York City bike share program, Citi Bike. Not only does this take care of her commute, but she also gets her exercise in for the day.

3. Renters insurance. If you rent, then paying for renters insurance, which tends to be very low cost (prices often start at around $100 a year, depending on location and other factors), is a must-have. That's because it covers your costs in the event of a fire or robbery, which could ruin you financially, says Jon Lal, founder and president of the website BeFrugal.com.

4. Netflix or another movie and television subscription service. Lal says shelling out for this kind of monthly entertainment fee makes sense because it saves you money in other areas. You're less tempted to go out to the movies, for example, and might even be able to cut cable. Another benefit is that you have access to older classics as well as newer movies currently airing.

5. Fitness memberships. If you enjoy classes such as yoga, barre or Pilates, then you know they often come with a hefty per-class price tag ranging from $15 to $25. Savings.com editor Susan Yoo-Lee recommends instead signing up for a monthly gym membership, which might set you back between $130 and $180 per month. But if you attend a few classes a week, the investment will easily pay for itself and bring the per-class rate down to less than what you were previously paying. You might even find yourself attending more classes.

[See: 11 Money Moves to Make Before You Turn 40.]

6. Other types of insurance. Life insurance, especially for anyone with dependents, is essential to protect family members in the event of your unexpected death, says John Schmoll, founder of FrugalRules.com. He also suggests paying for add-ons to your renters or homeowners insurance policy to make sure possessions such as jewelry, high-end cameras and other treasured items are covered.

Monthly costs to drop:

1. ATM fees. If you're still paying for ATM fees or any other type of monthly charges for using your bank account, then it's time to stop, says Larry Bills, editorial director for Offers.com. Switch banks to one that won't charge you for those fees, he says. "Don't get nickel and dimed just for spending and accessing your own money," he adds.

2. Unused subscriptions. If you take full advantage of your gym or Netflix subscription (as suggested above), then paying those monthly fees is not a problem. But if you haven't been to the gym or watched a Netflix movie in months, and you're still paying for those monthly charges, then it's time to rethink those habits. "Pick up the phone, and put an end to it," O'Connell urges. The sales representative might try to pitch you a hard sell when you cancel, but stay strong, she adds.

3. Your landline. If you pay a monthly charge for your landline but haven't used it since pre-smartphone days, then it's time to say goodbye, O'Connell says. "If the only time your landline rings is when telemarketers are calling to interrupt your dinner or the debt collector is looking for the person who used to have your number, then do yourself a favor and ditch it," she says.

4. Laundry fees. If you live in a place where you plan to stay a while, then Lal says buying your own washer and dryer will save you money in the long run, compared with shelling out for regular laundromat trips or a wash and fold service. You can cut costs even further by making your own detergent, using cold water for most washes and hang-drying clothes, he adds.

[See: 11 Expenses Destroying Your Budget.]

5. Warranties. It's tempting to pay extra at checkout for warranties on big items, from dishwashers to electronics, but they usually come with a lot of restrictions that render them pretty useless. Yoo-Lee's warranty policy charged her a $60 fee for a serviceperson to visit her house, and then the issues the servicer found weren't even covered by the policy. Instead of buying the warranty policies, Yoo-Lee recommends saving that money to put toward any necessary repairs.

6. Spa memberships. Yoo-Lee says that while the thought of paying $60 for access to a spa and regular massages might sound appealing, in reality, it can be hard to take full advantage of that kind of membership. If you sign up and then find yourself too busy to use the spa, you might not even be able to cancel until a certain amount of time has passed. "Save yourself the hassle, and just go to the spa and get a message when you need to and have the time. You'll end up spending less," she says.

After trimming your monthly costs with these tips, you might even find some extra cash to spend on a massage.



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