Author Topic: What expenses can be cut?  (Read 3807 times)

Sugaree

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What expenses can be cut?
« on: May 10, 2021, 10:13:42 AM »
Misc - $21.67
Car - $216.67 (This is not a true payment, but a payment to myself that goes in a HYSA for the next car)
Car tags- $10.83
Cell phones - $50.00
Electricity- $230.00 (This is actually a little too low, I think.  Last year's average was $246 though we are on track to do better this year)
Kid's 529- $162.50 (I'd like to increase this)
Kid's Allowance - $43.33 (can spend half and save/invest half)
Kid's Expenses- $41.67 (school supplies/extracurriculars/etc.)
DH's Misc- $130.00
Gas - $195.00 (Realistically, this is closer to $130/month but I prefer to budget for worst-case scenario high gas prices)
Groceries- $325.00 (Two adults and a 7 year-old)
Hair- $48.75
House Maintenance- $20.83
Insurance - $166.67 (Two cars, including comp/collision on the "good" car.  Hopefully will be lower next year when 2/3 of my husband's incidents have fallen off his record)
Internet- $65.00 (About to switch providers to drop this to $50/month for a year)
IRA- $500.00
Life Insurance- $25.00
Property Tax- $42.00
School Lunches- $35.25
Subscriptions- $35.58
Vacation- $216.67 (This is a major splurge for us)
Vet Bills- $50.00 (This probably should be increased)
Water- $90.00 (includes water, sewer, natural gas, and garbage)
xmas- $100.00 (xmas and all other gift-giving holidays)


That's a total of ~$2825/month.  I'm stuck between feeling like I've cut everything that I can comfortably cut and feeling like there is still room to go.  I'm trying to get connected with a vanpool to cut the gas costs down, but haven't had much luck finding one that works for me.  Anybody see anything else that can reasonably be cut? 

I've been struggling lately with FOMO.  There are several things that I *want* but I need to find something to cut (making more money would be the ideal solution, but my family is already way upset with how much I work). 

Dicey

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Re: What expenses can be cut?
« Reply #1 on: May 10, 2021, 10:26:17 AM »
Some mustachian people with pets swear by pet insurance, like @Tami1982. Might that be feasible for you?

MaybeBabyMustache

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Re: What expenses can be cut?
« Reply #2 on: May 10, 2021, 10:33:38 AM »
You are doing really well with your expenses. A few things that stand out to me for consideration (and, it's not that these are particularly high, but perhaps thinking if you are getting the value exchange you are looking for from them):

-DH misc. Any chance to shave this slightly? If this is not of interest to your partner, that's not where I'd suggest starting
-Haircuts. COVID has taught me that most hair can be cut at home. Is that an option?
-Subscriptions. Are you getting max value for these? Do you use them regularly? Other cheaper options?
-School lunches. My cunderstanding is that the government is currently covering all school lunches across the US this year, and that will continue next year. What is this going for? In either case, this is more than we give our high school/middle schooler. We give them less so that they get into the habit of packing a lunch, and consider school lunches a special treat. Is that an option?
« Last Edit: May 10, 2021, 10:47:54 AM by MaybeBabyMustache »

YttriumNitrate

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Re: What expenses can be cut?
« Reply #3 on: May 10, 2021, 10:43:37 AM »
House Maintenance- $20.83
Unless you're not including repairs (HVAC, roof, etc.), this seems quite low. 

Sugaree

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Re: What expenses can be cut?
« Reply #4 on: May 10, 2021, 10:54:23 AM »
Some mustachian people with pets swear by pet insurance, like @Tami1982. Might that be feasible for you?

I've thought about this.  Right now, I've got an almost 12 year-old golden retriever and the insurance is too much.  I will probably get this on the 2 year-old Lab.

Sugaree

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Re: What expenses can be cut?
« Reply #5 on: May 10, 2021, 11:00:58 AM »
You are doing really well with your expenses. A few things that stand out to me for consideration (and, it's not that these are particularly high, but perhaps thinking if you are getting the value exchange you are looking for from them):

-DH misc. Any chance to shave this slightly? If this is not of interest to your partner, that's not where I'd suggest starting
     This covers his gas and cigarettes (ugh...I know) and random spending money, so it's really probably as low as we can go with it.
-Haircuts. COVID has taught me that most hair can be cut at home. Is that an option?
     Maybe?  I have my hair cut and colored every 10 weeks.  It's rainbow and it's something that I couldn't do on my own
-Subscriptions. Are you getting max value for these? Do you use them regularly? Other cheaper options?
     I do use these.  The number may be a little high because it is calculated using the full Sirius price and I play the game where I call and threaten to cancel every year.  I also include Prime in that number which is something I've been considering getting rid of.
-School lunches. My cunderstanding is that the government is currently covering all school lunches across the US this year, and that will continue next year. What is this going for? In either case, this is more than we give our high school/middle schooler. We give them less so that they get into the habit of packing a lunch, and consider school lunches a special treat. Is that an option?
     That has been going into his 529 while he's been getting free lunch.  I'm thinking that his school will eventually qualify for free lunch for everyone, but if that doesn't happen having him pack his own lunches is a great idea!
« Last Edit: May 10, 2021, 11:03:18 AM by Sugaree »

Sugaree

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Re: What expenses can be cut?
« Reply #6 on: May 10, 2021, 11:02:36 AM »
House Maintenance- $20.83
Unless you're not including repairs (HVAC, roof, etc.), this seems quite low.

We have a several thousand dollars already set aside and earmarked for the HVAC, which is very likely the next thing to go out.  The roof is three years old, so I'm less worried about that.  But you're right this is too low and it's in our short-term plans to address this. 

dougules

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Re: What expenses can be cut?
« Reply #7 on: May 10, 2021, 02:59:03 PM »
Could you explain a little more about the FOMO?  What's the plan that's driving cutting back further?

Freedomin5

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Re: What expenses can be cut?
« Reply #8 on: May 10, 2021, 04:59:51 PM »
You’re doing pretty well, but $100/month for gifts is a bit steep. Also, you can totally cut your own hair — it really isn’t hard, and there are several YouTube videos that teach you how.

G-dog

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Re: What expenses can be cut?
« Reply #9 on: May 10, 2021, 06:06:53 PM »
Over $40 a month allowance for a 7 year old sounds high. Though my parents never gave me an allowance, so I have no real experience.  Does your child do any chores to earn the allowance (or part of it?  It is probably a good age to start simple chores (and some argue that these should be uncoupled from allowance).

I agree that $100/mo for gifts sounds high (how many people / events do you feel obligated to give gifts too?)

Electricity is high as well, you may be able to shave that some buy figuring out what appliances, devices are using the most, and whether you can stop using them, turn them off (TV, computers), upgrade to energy efficient (like lightbulbs), etc.

Both you and DH have “luxury” things you are buying (rainbow hair, cigarettes (UGH! -I hate cigarettes)).

Do you have an idea what your savings rate is?  If your net income is $2900/mo - then deeper cuts are something to think about.  But if you make $7000/mo ....

maisymouser

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Re: What expenses can be cut?
« Reply #10 on: May 10, 2021, 06:53:09 PM »
Misc - $21.67
Car - $216.67 (This is not a true payment, but a payment to myself that goes in a HYSA for the next car)
Car tags- $10.83
Cell phones - $50.00
Electricity- $230.00 (This is actually a little too low, I think.  Last year's average was $246 though we are on track to do better this year) That's an insane-o electric bill as others have commented. What's driving that and can you lower it?
Kid's 529- $162.50 (I'd like to increase this)
Kid's Allowance - $43.33 (can spend half and save/invest half)
Kid's Expenses- $41.67 (school supplies/extracurriculars/etc.)
DH's Misc- $130.00
Gas - $195.00 (Realistically, this is closer to $130/month but I prefer to budget for worst-case scenario high gas prices)That is a lot of gas
Groceries- $325.00 (Two adults and a 7 year-old)
Hair- $48.75 Almost $50 A MONTH on hair? This is really not necessary. Get a buzz cutter and a pair of scissors for <$40 and you'll find an extra $600/year.
House Maintenance- $20.83 Almost certainly on the low end. Also, I have to wonder how your projected maintenance is so low with an electric bill so high- the latter would indicate a mega house based on what you are currently spending, but maybe that's not the case.
Insurance - $166.67 (Two cars, including comp/collision on the "good" car.  Hopefully will be lower next year when 2/3 of my husband's incidents have fallen off his record) Seems high to me but I understand this varies by state. I think we end up spending ~$100/mo in NC with comp/collision on our 'good' car. Have you shopped around lately?
Internet- $65.00 (About to switch providers to drop this to $50/month for a year) Yay!
IRA- $500.00 I wouldn't include this as an expense, personally (as long as it is invested it is savings in my book)
Life Insurance- $25.00
Property Tax- $42.00
School Lunches- $35.25
Subscriptions- $35.58
Vacation- $216.67 (This is a major splurge for us) I'm sure it is, considering that's almost $2600/year. Maybe you could take fewer or less extravagant trips. That seems like a big area for improvement if you really do want to save more $. Of course, maybe you find it worth it- but you did ask where the fat is, so... Some of it is here!
Vet Bills- $50.00 (This probably should be increased)
Water- $90.00 (includes water, sewer, natural gas, and garbage)
xmas- $100.00 (xmas and all other gift-giving holidays)We don't typically spend more than $25/person on any gifts. You must have a lot of friends/family!!! XD


That's a total of ~$2825/month.  I'm stuck between feeling like I've cut everything that I can comfortably cut and feeling like there is still room to go.  I'm trying to get connected with a vanpool to cut the gas costs down, but haven't had much luck finding one that works for me.  Anybody see anything else that can reasonably be cut? 

I've been struggling lately with FOMO.  There are several things that I *want* but I need to find something to cut (making more money would be the ideal solution, but my family is already way upset with how much I work).

I bolded what I think can be reasonably cut by 30%+ without seriously sacrificing your quality of life. I think maybe you could focus on figuring out why you "want" things that cost money. Maybe they are worth it, maybe not. But most people on this forum would suggest that at a spend of nearly $28k/year on non-mortgage items (that figure excludes your IRA contributions), you are living fairly extravagantly- at least from a financial perspective if not also a personal one. I would ask you- are you actually getting the bang for your buck on those bolded items? If not, work to reduce them. If you are, then maybe consider that you may need to practice mindfulness, not care what your friends/neighbors are buying for FOMO, or figure out what is actually making you unhappy.
« Last Edit: May 10, 2021, 06:55:41 PM by maisymouser »

bbqbonelesswing

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Re: What expenses can be cut?
« Reply #11 on: May 10, 2021, 07:03:36 PM »
$2,825/month for the whole family is already pretty low. Without any more context than what's been posted here, I'd say it might be a better use of your time to try to increase your income instead of squeezing another few dollars out of an already decent budget.

Metalcat

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Re: What expenses can be cut?
« Reply #12 on: May 10, 2021, 07:04:45 PM »
Your budget is already pretty tight, anything you cut is going to result in significant trade offs. Like, you mention that you spend as much as you do on your hair because it's rainbow coloured and you can't do that yourself. Well, that's a lifestyle choice, either the rainbow hair is the priority or the other FOMO things are.

It sounds though like you're really down to the wire on the things you want and need in your life, I'm not sure many of us can offer you many places left to cut, because as I said above, we can only suggest cutting things that seem to matter to you, like having your hair professionally coloured, or giving gifts.

Any judgement calls of what more to cut are really going to have to be yours to make, unfortunately, because we can't decide for you what's worth less than the things you are trying to save for.

As for income, is there any path to making more other than working more hours? Is there some learnable skill set that could bump you into a higher income range?

moneymatters242

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Re: What expenses can be cut?
« Reply #13 on: May 11, 2021, 01:34:19 PM »
The only item that really raises my eyebrows is the electricity cost.  The rest of your expenses (minus insurance cost - which is understandable given the accident history, and vacation costs, which are of course a personal decision) are similar to my own which I consider to be pretty heavily optimized.

Two fairly rigid variables with electricity costs are the state in which you live and the size of your house.  But for comparison, I live in FL (AC running most of the year) and have around a 2800sqft house and we avg $140/mo on electric.  I would guess FL is an above-average electricity usage state and we have an above-average house size, so I would think you in comparison would have a good chance of lowering electricity costs well below $246/mo.

Here's a few tips that might be helpful:
  • Install a programmable thermostat if you don't have one.  If no one's home during certain hours of day, set desired temp high during those hours in summer (we target 80 degs) & low during those hours in winter. This makes a big difference.
  • Use the same idea with floors of the house if you have a 2 story - IE: during summer hours when you're downstairs, turn temp upstairs high.  Hours when you're upstairs (IE sleeping), turn temp downstairs high.
  • Draw curtains/blinds during the day during summer to keep heat out.  Open all of them up during the winter to let heat in.
  • If you have a lot of refrigerators/freezers, especially old ones, consider scrapping them or if you can't, maybe even consider replacing. Old fridges/freezers use a LOT of electricity over time.
  • If you plan to live in your house a long time, change to all LED light bulbs - saves a significant amount of electricity.  And get the family in the habit of shutting lights/tvs etc. off in rooms they aren't present.
« Last Edit: May 11, 2021, 04:32:42 PM by moneymatters242 »

lutorm

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Re: What expenses can be cut?
« Reply #14 on: May 11, 2021, 07:45:36 PM »
Yeah, what's the $/kWh and kWh/day on that electricity? As a contrast, before we got PV here, our monthly bill was over $200. That's with no heating/AC, but electric hot water and Hawaii's $0.35/kWh price.

Sugaree

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Re: What expenses can be cut?
« Reply #15 on: May 12, 2021, 05:31:18 AM »
So the deal with the electricity is that it's a 1600 sqft, 60 year-old house.  I live in Alabama, so air conditioning is the major driver in my power bill.  Especially considering my HVAC unit was made in 1989.  For example, last July I used 2325 kWh at ~$.11 per kWh.  But there were also like $65 worth of random fees that are not itemized on the bill.  I've tried several times to figure out exactly how Alabama Power calculates their bills, but have never been able to nail it down. 

I have a programable thermostat that sets the temp to 81 when no one's home, 73 when people are home, and 75 at night.  It also doesn't allow the temp to be manually set lower than 71.  I could probably bump those numbers up a little and see if the family mutinies. 

Other than that, the only things I can really thing of are an extra fridge and two chest freezers.  I'm in negotiations with my husband to eliminate at least one of these, preferably the bigger of the two freezers.  It was my grandparents' and is big enough to store a couple of bodies.  We don't need that.  And it's taking up space. 

CupcakeGuru

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Re: What expenses can be cut?
« Reply #16 on: May 12, 2021, 06:29:15 AM »
Overall, your budget seems pretty reasonable.

The one thing that jumps out for me is your 1989 hvac unit is probably why your kWh is so high. For example, last July we used 2125 kWh for a 3300 sq ft house that has 2 hvac units in Georgia. We replaced our 1988 units a couple of years ago and went from almost 4,500 kWh to about 2,000 in the summer.

Sugaree

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Re: What expenses can be cut?
« Reply #17 on: May 12, 2021, 09:04:45 AM »
Overall, your budget seems pretty reasonable.

The one thing that jumps out for me is your 1989 hvac unit is probably why your kWh is so high. For example, last July we used 2125 kWh for a 3300 sq ft house that has 2 hvac units in Georgia. We replaced our 1988 units a couple of years ago and went from almost 4,500 kWh to about 2,000 in the summer.

I think that this is likely the major culprit in our power bill being so high.  We've got some cash set aside specifically for this replacement and have been researching exactly what we need.

ixtap

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Re: What expenses can be cut?
« Reply #18 on: May 12, 2021, 09:23:22 AM »
I am concerned about what isn't there. Clothes, car maintenance, human health care...

Morning Glory

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Re: What expenses can be cut?
« Reply #19 on: May 12, 2021, 10:15:35 AM »
Congratulations on that grocery bill!!!! Mine is about 500 for four people. You guys are doing great. Your total spending is less than 2000/month when you take out the IRA and 529s. I'm guessing you have a pretty high savings rate because your income is high enough to have to pay for school lunch in normal times.

 I'm guessing you live in a rural area and your electricity is on a coop. They tend to have higher facility charges because they have more lines to maintain than the power company in town. My power bill is higher than yours and I don't even run the ac, but my main driver is sump pumps. I drove myself nuts trying to reduce this.

I would second the idea of trying to get rid of one of the freezers and the extra fridge. I would not be able to eat two fridges of food before it goes bad, although people in hot climates should weigh in on this because you guys might have to store more things in there.

I guess that the husband smoking and snack budget drives you nuts. My husband's was energy drinks and being overweight. Nothing I did helped.

Does your husband work? Does one of your employees provide healthcare? How would you qualify for Medicaid but not free school lunch? I am just being nosy here so just ignore these questions if you don't feel comfortable answering.

joe189man

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Re: What expenses can be cut?
« Reply #20 on: May 12, 2021, 10:32:48 AM »
Maybe i didnt see it but there isn't a line item for mortgage/rent?

your budget is 2850+/- is your household take home about that much or more? Less? are you maxing 401ks?

whats the end goal? are you trying to FIRE asap? or cut some expenses to do or buy what? we need more info to help with an answer.

Sugaree

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Re: What expenses can be cut?
« Reply #21 on: May 12, 2021, 11:20:31 AM »
Maybe i didnt see it but there isn't a line item for mortgage/rent?

your budget is 2850+/- is your household take home about that much or more? Less? are you maxing 401ks?

whats the end goal? are you trying to FIRE asap? or cut some expenses to do or buy what? we need more info to help with an answer.

Good catch.  I inherited the house, so it's paid for.  Take home is more or less what's budgeted.  It's zero-based budgeting on steroids.  We are maxing out the TSP.  Plus the HSA and IRA.  We do use the HSA to pay for any health expenses we have, but usually have a good bit left over at the end of the year. 

I'm trying to get onto a vanpool to cut the gas budget down a bit.  I'm currently commuting 60 miles round trip. 

I guess the end goal is just to optimize the budget.  There are things that I'd like to add, like car maintenance (separate from the car replacement fund) or maybe eating out every couple of weeks.  I'd like to increase the 529 savings to catch up a little.  I need to increase the house maintenance fund.  I need to increase the vet bill fund.  Based on today's CPI data, it looks like the max for TSP contributions is going to go up more than I thought, so that will be an extra expense next year too. 
« Last Edit: May 12, 2021, 11:23:29 AM by Sugaree »

joe189man

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Re: What expenses can be cut?
« Reply #22 on: May 12, 2021, 12:41:51 PM »
I'm trying to get onto a vanpool to cut the gas budget down a bit.  I'm currently commuting 60 miles round trip. 

I guess the end goal is just to optimize the budget. 

The budget looks tight and fairly optimized as is, the gift and vacation budgets can be used for other categories if needed. maybe focus on you and spouse making more

Do you need pets? thats $600+ a year

A few ideas are to either find a similar job closer to home to reduce commute time and fuel usage, sell your current house to move closer to work to reduce the commute and fuel usage, or get a prius to sip fuel.

you are spending 5 hours+ a week in traffic to drive 60 miles round trip to work

terran

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Re: What expenses can be cut?
« Reply #23 on: May 12, 2021, 01:35:20 PM »
Cell phones could come down. Check out the annual plans from Red Pocket (especially the second set a little further down the page).

secondcor521

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Re: What expenses can be cut?
« Reply #24 on: May 12, 2021, 09:48:21 PM »
Two options:

1.  Divide your list into musts and wants.  Musts are things that it takes to live, so that is food, shelter, clothing, basic utilities, and transportation to/from work.  Then prioritize the wants (with your husband, see #2 below) by taking two at a time, comparing them, and deciding which you'd give up if you had to.  Then cut the least important wants.

2.  Get your husband on board by talking with him and finding common future goals that need money to fund, whatever those happen to be (retirement, kids' college, 20th anniversary trip to Hawaii, whatever).  Then work together to find out how to adjust the budget to make those things happen.  Right now it sounds like you have goals and you're trying to figure out how to achieve them without your husband pulling in the same direction with you.

On point #2, I may be reading into the way you're writing about it so I may be wrong there.  If so, just disregard I guess.

Overall you're at about a $26K budget (ignoring IRA and 529, which are savings items, not spending) for a family of three in Alabama, which is really pretty low all things considered.

I guess you could also try getting your utility bills down by improving the insulation in your home.  That'll be cheaper than a new HVAC.  It'll also help in both the summer and the winter.  Maybe you already have enough in your utility fund where springing for some insulation would pencil out and be doable.  Insulation is something that is also usually something most homeowners can DIY, so you'd have no labor costs.

brandon1827

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Re: What expenses can be cut?
« Reply #25 on: May 13, 2021, 07:37:49 AM »
To chime in on the electricity costs since I work at an electric cooperative...heating/cooling are by far the highest user of electricity in the home. Changing the temperature to different settings throughout the day will be a big reason for higher kWh consumption on your bill. Because the outdoor temperature has such a high impact on how hard your unit has to work to regulate temperature, keeping it set on one consistent temp should actually save you some money on your bill. It seems counter-intuitive, but changing the temp on your thermostat multiple times per day is one of the worst things you can do if you're concerned about saving money on electricity. Also, with a home built in the 1960s I would immediately assume that the insulation is probably costing you money on your electric bill also. People lose so much hot/cool air through poor insulation, and can't figure out why tampering with the thermostat isn't resulting in more savings.

From a "how the bill is structured" perspective, utilities have shifted over the past 10 years regarding how they recover costs. Many used to focus on keeping fixed charges as low as possible; which meant recovering costs through the kWh charge. This meant that utilities were "chasing" cost recovery many times and potentially having to raise/lower the kWh charge many times in a given fiscal year. Now, many of them have figured out that it's much more financially sound to increase fixed charges to recover costs (purchased power, infrastructure maintenance, etc.) in order to reduce the wild swings in rates/bills that are caused by weather volatility. That has made the actual sale of electricity pretty much a straight pass-through from the power provider to the customer...with utilities not making a dime on actual electric sales. Bottom line is that in order to save on electric bills in today's world, you'd need to consider upgrading things like insulation, windows, sealants, etc. Energy efficient appliances, LED bulbs, using power in off-peak times, etc. are good ways to impact your bill...but if you really want to get some bang for your buck, upgrade the shell of your home.

One other (admittedly potentially very expensive) option would be to look into a solar installation. We have members in our coop who invested in solar through a TVA incentive program, and many months those people end up with a credit instead of owing anything on their utility bills. I haven't looked into it in several years, but the initial investment to payoff break-even point was terribly long (maybe 20 years)...but if those costs have come down significantly, it could be worth looking into.

Morning Glory

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Re: What expenses can be cut?
« Reply #26 on: May 13, 2021, 08:02:03 AM »
I will admit that I don't get zero based budgeting. I drove myself nuts trying to do it once. I track spending and fund my accounts as I go, but I don't really understand putting aside a little money every month for each thing. I have a bit in a savings account for emergencies but I usually just cash flow the big expenses and invest a bit less that month. I'm not saying you shouldn't do it, just that it didn't work for me.

Sugaree

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Re: What expenses can be cut?
« Reply #27 on: May 13, 2021, 08:20:16 AM »
Congratulations on that grocery bill!!!! Mine is about 500 for four people. You guys are doing great. Your total spending is less than 2000/month when you take out the IRA and 529s. I'm guessing you have a pretty high savings rate because your income is high enough to have to pay for school lunch in normal times.

 I'm guessing you live in a rural area and your electricity is on a coop. They tend to have higher facility charges because they have more lines to maintain than the power company in town. My power bill is higher than yours and I don't even run the ac, but my main driver is sump pumps. I drove myself nuts trying to reduce this.

I would second the idea of trying to get rid of one of the freezers and the extra fridge. I would not be able to eat two fridges of food before it goes bad, although people in hot climates should weigh in on this because you guys might have to store more things in there.

I guess that the husband smoking and snack budget drives you nuts. My husband's was energy drinks and being overweight. Nothing I did helped.

Does your husband work? Does one of your employees provide healthcare? How would you qualify for Medicaid but not free school lunch? I am just being nosy here so just ignore these questions if you don't feel comfortable answering.

We're not on Medicaid.  We have a HDHP/HSA through my job.  My husband currently stays at home with the kid due to some health issues.  We're hoping that he'll be able to return to work in the fall.  I don't care so much about how he spends his money until he spends it all and still needs gas on Wednesday. 

Sugaree

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Re: What expenses can be cut?
« Reply #28 on: May 13, 2021, 08:23:43 AM »
@brandon1827 , I would love solar.  Unfortunately, AP has instituted a $5/kW/month charge for anyone that has solar.  I've yet to find a system that would make the ROI worth it. 

I did have insulation blown in three years ago when we replaced the roof after a tornado.  I am considering adding a few inches to that.  My ductwork runs in the crawlspace below the house, do you think it's worth looking into insulating them?  The space stays fairly cool even during the hottest months.

zolotiyeruki

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Re: What expenses can be cut?
« Reply #29 on: May 13, 2021, 08:48:57 AM »
WRT your electricity bill, I'd be pointing a big fat finger at your A/C and insulation.  You've added insulation to your attic, but what about air sealing?  Your 60-year-old walls probably have very little insulation, or what is there has compressed or sagged beyond any effectiveness.  You could get cellulose blown into all your wall cavities to reduce the heat gain there as well.

The current job market is pretty hot right now.  Have you done any searching to see if there's something higher-paying and/or closer to home?

brandon1827

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Re: What expenses can be cut?
« Reply #30 on: May 13, 2021, 09:20:13 AM »
@brandon1827 , I would love solar.  Unfortunately, AP has instituted a $5/kW/month charge for anyone that has solar.  I've yet to find a system that would make the ROI worth it. 

I did have insulation blown in three years ago when we replaced the roof after a tornado.  I am considering adding a few inches to that.  My ductwork runs in the crawlspace below the house, do you think it's worth looking into insulating them?  The space stays fairly cool even during the hottest months.

I think it could be worth looking into at the least. We provide a free 'energy audit' for our members who are looking for ways to improve things in the home to help lower bills. Our guys will come in, use a infrared temp device to show where you could be losing heat/air so that people can address those issues. It might be worth reaching out to your LPC to see if they offer something similar. A lot of times for us, its when customers have taken several steps to try to reduce their energy consumption, but are still frustrated that they haven't been able to significantly reduce their bills. We offer it as a free service, and in addition to checking for heat/air issues, we test the meter for accuracy just to make certain there are no issues there. If it's free from your LPC, might as well take advantage of that to see what they find. Sometimes, it's really surprising to people to see where they're losing heat/air.

Insulating the ductwork and looking for any potential spots where joints may not have been done correctly could help lower those heating/cooling costs. If your ductwork is laying on the ground in your crawl space, you could also consider connecting it to your floor joists to get it up off of the ground.

secondcor521

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Re: What expenses can be cut?
« Reply #31 on: May 13, 2021, 09:28:36 AM »
I will admit that I don't get zero based budgeting. I drove myself nuts trying to do it once. I track spending and fund my accounts as I go, but I don't really understand putting aside a little money every month for each thing. I have a bit in a savings account for emergencies but I usually just cash flow the big expenses and invest a bit less that month. I'm not saying you shouldn't do it, just that it didn't work for me.

You're mixing two different concepts.

Zero based budgeting, the way I was using the term, simply means sitting down with a paycheck and deciding when you get it (or even a bit before) where every dollar is going.  Making up numbers, $750 to rent, $38 to the electricity bill, $50 for the eating out envelope, etc. until every dollar is allocated and there is zero left over.  The allocation can be different from paycheck to paycheck, as long as you allocate all of the money before you actually spend it.

Setting up sinking funds for many different categories is a different concept altogether.  $7.38 for Christmas every month, or $12.88 for the clothing category.  It's a lot of work and effort to implement sinking funds in a budget, especially over a large number of categories, unless you use a physical envelope system or an electronic envelope system provided by a bank or a software program.  But it can provide more certainty and conceptually level spending, which can be very helpful to people who, unlike you (and me), don't have a lot of margin in their cash flow.

Morning Glory

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Re: What expenses can be cut?
« Reply #32 on: May 13, 2021, 10:15:49 AM »
I will admit that I don't get zero based budgeting. I drove myself nuts trying to do it once. I track spending and fund my accounts as I go, but I don't really understand putting aside a little money every month for each thing. I have a bit in a savings account for emergencies but I usually just cash flow the big expenses and invest a bit less that month. I'm not saying you shouldn't do it, just that it didn't work for me.

You're mixing two different concepts.

Zero based budgeting, the way I was using the term, simply means sitting down with a paycheck and deciding when you get it (or even a bit before) where every dollar is going.  Making up numbers, $750 to rent, $38 to the electricity bill, $50 for the eating out envelope, etc. until every dollar is allocated and there is zero left over.  The allocation can be different from paycheck to paycheck, as long as you allocate all of the money before you actually spend it.

Setting up sinking funds for many different categories is a different concept altogether.  $7.38 for Christmas every month, or $12.88 for the clothing category.  It's a lot of work and effort to implement sinking funds in a budget, especially over a large number of categories, unless you use a physical envelope system or an electronic envelope system provided by a bank or a software program.  But it can provide more certainty and conceptually level spending, which can be very helpful to people who, unlike you (and me), don't have a lot of margin in their cash flow.

Ok. I tried to do the every dollar app on the recommendation of a friend and ended up constantly moving money from one category to another because the spending isn't the same every month and I'm not the one who does the shopping so I don't have much control over it. Physical envelopes might be easier but I don't feel comfortable having a bunch of cash in the house. I suppose if I could do it over a year instead of a month it would make more sense to me.

I am sorry about the health insurance misunderstanding. I count mine as spending even though it comes out of my paycheck pretax.  I think you are doing great!!!

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Re: What expenses can be cut?
« Reply #33 on: May 13, 2021, 10:58:28 AM »
To chime in on the electricity costs since I work at an electric cooperative...heating/cooling are by far the highest user of electricity in the home. Changing the temperature to different settings throughout the day will be a big reason for higher kWh consumption on your bill. Because the outdoor temperature has such a high impact on how hard your unit has to work to regulate temperature, keeping it set on one consistent temp should actually save you some money on your bill. It seems counter-intuitive, but changing the temp on your thermostat multiple times per day is one of the worst things you can do if you're concerned about saving money on electricity. Also, with a home built in the 1960s I would immediately assume that the insulation is probably costing you money on your electric bill also. People lose so much hot/cool air through poor insulation, and can't figure out why tampering with the thermostat isn't resulting in more savings.
Thanks for this info! Our clown house, built in 2007, has 14' ceilings in the large main living area. We thought we were doing the right thing by using a programmable thermostat to lower the heat at night. Turns out leaving it at the same temperature all winter long actually makes the relatively new unit run less, which boggles our minds. Counterintuitive indeed!

moneymatters242

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Re: What expenses can be cut?
« Reply #34 on: May 13, 2021, 06:30:07 PM »
Changing the temperature to different settings throughout the day will be a big reason for higher kWh consumption on your bill. Because the outdoor temperature has such a high impact on how hard your unit has to work to regulate temperature, keeping it set on one consistent temp should actually save you some money on your bill. It seems counter-intuitive, but changing the temp on your thermostat multiple times per day is one of the worst things you can do if you're concerned about saving money on electricity.

Sometimes things seem counter-intuitive for good reason.  If there were no cost savings from adjusting temps in your house, the market for programmable thermostats probably never would have gotten off the ground.  The theory that you'll save more money by keeping your thermostat the same temp all day is a myth that also defies thermodynamics.  The basic equations for heat transfer are that the larger the temperature difference between two objects, the greater the rate of heat transfer.  By raising your thermostat temp in the summer when you're away from home, you're reducing the temp difference between your home and the outdoors - this causes less heat to flow into your home, meaning your AC runs less.  In contrast, if you keep your thermostat at a constant (and thus lower) temperature all day, you're increasing the temp difference between your house and the outdoors for longer on average, allowing greater amounts of heat to flow into your home, thus making your AC run more.

An article with more info on the benefits of alternating thermostat settings courtesy of the US Dept. of Energy:
https://www.energy.gov/energysaver/thermostats
« Last Edit: May 13, 2021, 06:34:33 PM by moneymatters242 »

brandon1827

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Re: What expenses can be cut?
« Reply #35 on: May 14, 2021, 06:59:38 AM »
My response would be that it depends. If your home is newer, with adequate insulation, argon gas filled double or triple pane windows, etc., and you don't have a heat pump, then maybe changing the temps would be of benefit. However, the OP lives in Alabama with a home that is 60+ years old and has already stated that the insulation could stand to be upgraded. With heat pumps/hvac, changing the temp multiple times per day will cause performance inefficiency that more than offsets any potential savings from raising/lowering the temp with a programmable thermostat. In that scenario (as your article pointed out) choosing a moderate setting and leaving it alone is more cost-effective. These situations can be very home-specific depending on each individual location's factors, but with the set of facts provided by the OP about the home it seems like reasonable advice.
« Last Edit: May 14, 2021, 07:07:35 AM by brandon1827 »

yachi

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Re: What expenses can be cut?
« Reply #36 on: May 14, 2021, 08:15:42 AM »
Changing the temperature to different settings throughout the day will be a big reason for higher kWh consumption on your bill. Because the outdoor temperature has such a high impact on how hard your unit has to work to regulate temperature, keeping it set on one consistent temp should actually save you some money on your bill. It seems counter-intuitive, but changing the temp on your thermostat multiple times per day is one of the worst things you can do if you're concerned about saving money on electricity.

Sometimes things seem counter-intuitive for good reason.  If there were no cost savings from adjusting temps in your house, the market for programmable thermostats probably never would have gotten off the ground.  The theory that you'll save more money by keeping your thermostat the same temp all day is a myth that also defies thermodynamics.  The basic equations for heat transfer are that the larger the temperature difference between two objects, the greater the rate of heat transfer.  By raising your thermostat temp in the summer when you're away from home, you're reducing the temp difference between your home and the outdoors - this causes less heat to flow into your home, meaning your AC runs less.  In contrast, if you keep your thermostat at a constant (and thus lower) temperature all day, you're increasing the temp difference between your house and the outdoors for longer on average, allowing greater amounts of heat to flow into your home, thus making your AC run more.

An article with more info on the benefits of alternating thermostat settings courtesy of the US Dept. of Energy:
https://www.energy.gov/energysaver/thermostats
As the article mentions but glosses over, humidity control is one thing to consider when setting your higher AC temperature setpoint.  We have a programmable thermostat that also allows separate humidity control.  It's not a problem in PA, but in other states you really want to remove the moisture all the time to keep your structure safe.
On the heating side, the article mentions not using programmable thermostats it on heat pumps.  Lots of heat pumps have backup resistance heat that kicks in when a temperature difference is larger than X degrees.  This means, you'll have great efficiency as long as the desired temperature and the actual temperature are 1-2 degrees apart, but terrible efficiency if they are 4-5 degrees apart.

OP may want to get some quotes on replacing the 1980's HVAC system.  Today's units have minimum efficiency ratings of 14 SEER, compared to  units from the 1980's with efficiencies of less than 7 SEER.  Meaning they'll cost less to run.  We replaced a 1980's unit in 2010, but alas did not live in the house long enough to get good base data on the 1980's electricity cost.

bacchi

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Re: What expenses can be cut?
« Reply #37 on: May 14, 2021, 09:14:38 AM »
My response would be that it depends. If your home is newer, with adequate insulation, argon gas filled double or triple pane windows, etc., and you don't have a heat pump, then maybe changing the temps would be of benefit. However, the OP lives in Alabama with a home that is 60+ years old and has already stated that the insulation could stand to be upgraded. With heat pumps/hvac, changing the temp multiple times per day will cause performance inefficiency that more than offsets any potential savings from raising/lowering the temp with a programmable thermostat. In that scenario (as your article pointed out) choosing a moderate setting and leaving it alone is more cost-effective. These situations can be very home-specific depending on each individual location's factors, but with the set of facts provided by the OP about the home it seems like reasonable advice.

https://en.wikipedia.org/wiki/Newton%27s_law_of_cooling

Quote from: wiki
Newton's law of cooling states that the rate of heat loss of a body is directly proportional to the difference in the temperatures between the body and its surroundings.

It's more efficient for a non-inverter unit to run continuously to "catch up" than it is to maintain a temperature.* In other words, if you're going to be gone for 8 hours at work or on a hike, changing the thermostat will absolutely decrease electricity usage. Even in a modern, well insulated house, the interior-exterior temperature difference is what matters. Further, constant cycling of an HVAC unit (trying to maintain a temperature) causes more stress than one 30 minute run.

An inverter mini-split might be different because they ramp and they're more efficient at lower speeds. However, they're also more efficient at more equivalent interior-exterior temperatures.

This applies to any AC. When I put my heat pump water heater in "vacation" mode this winter, it maintained the water at 50F. Even with running it back up to 120F when we returned, we still saved electricity. I can see this from my WH app.

Yes, humidity is a concern in some areas and running the AC more would fix that.


* With the exception of a heat-pump/gas furnace with resistive backup heat, as yachi mentioned.


https://homeguides.sfgate.com/cheaper-leave-central-heat-running-time-70631.html

Quote from: sfgate
Conventional wisdom holds that it costs more to heat a home up than to keep it warm, and your furnace works harder to do it, too. Conventional wisdom is wrong. First of all, a furnace doesn't actually work "harder" -- it merely works longer.

https://www.paenergyratings.com/blog/is-it-cheaper-to-leave-your-thermostat-at-one-temperature/

Etc, etc, etc.


« Last Edit: May 14, 2021, 09:21:35 AM by bacchi »

moneymatters242

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Re: What expenses can be cut?
« Reply #38 on: May 16, 2021, 09:22:34 AM »
My response would be that it depends. If your home is newer, with adequate insulation, argon gas filled double or triple pane windows, etc., and you don't have a heat pump, then maybe changing the temps would be of benefit. However, the OP lives in Alabama with a home that is 60+ years old and has already stated that the insulation could stand to be upgraded. With heat pumps/hvac, changing the temp multiple times per day will cause performance inefficiency that more than offsets any potential savings from raising/lowering the temp with a programmable thermostat. In that scenario (as your article pointed out) choosing a moderate setting and leaving it alone is more cost-effective. These situations can be very home-specific depending on each individual location's factors, but with the set of facts provided by the OP about the home it seems like reasonable advice.
I think you've misunderstood the caveat in the article about heat pumps. Even with a heat pump, it's advantageous to use a programmable thermostat, so long as you're using it in cooling mode.  As the two previous posters said, heat pumps often have very inefficient resistance heaters installed that turn on when the difference between the set temp and desired temp is large, so if you're using a heat pump in the winter, it is better to keep the temp within a range that does not trigger the resistance heater (1-2 degrees) simply because of how inefficient those are.  I have a heat pump and this is what I do in Florida during a few of the winter months.  But during the summer, it's still very beneficial to adjust your temps when no one's at home.

Also, Yachi brought up a good point I forgot to mention about how it's more efficient for a unit to run continuously (which it would do more of due to adjusting temps when not at home, since it takes a longer time to re-cool the home) than in very short bursts (which it would do much more of if a constant temp is set all day long as it cycles on/off more).

Also, I would argue that a house that is poorly insulated like we assume the OP's is would actually benefit -more- from a programmable thermostat, not less as you suggest.  Because a house with extremely good insulation means that the rate of heat transfer that the simple Newton's law of cooling formulas would imply are further reduced, which means the benefit the person would see from adjusting temps throughout the day would be lessened somewhat.
« Last Edit: May 16, 2021, 09:41:03 AM by moneymatters242 »

zoro

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Re: What expenses can be cut?
« Reply #39 on: May 18, 2021, 10:40:29 AM »
Overall, your budget seems pretty reasonable.

The one thing that jumps out for me is your 1989 hvac unit is probably why your kWh is so high. For example, last July we used 2125 kWh for a 3300 sq ft house that has 2 hvac units in Georgia. We replaced our 1988 units a couple of years ago and went from almost 4,500 kWh to about 2,000 in the summer.

I think that this is likely the major culprit in our power bill being so high.  We've got some cash set aside specifically for this replacement and have been researching exactly what we need.

Have you thought about putting in your own AC units? I got a $6000k quote to change my central airl units. I am moderately handy, and so I used a company called Alpine Home air - I bought the equipment for $930. I had to buy a couple of tools from harbor freight so all in the job was $1.2K.  I did my first one in 2013, and then the upstairs one went last year and i changed that too. Both still work really well.  I used the special solder, so I didnt even have to braise..... AC people sell it as complicated - if you can work on your own car - it is def something you can do yourself.

yachi

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Re: What expenses can be cut?
« Reply #40 on: May 18, 2021, 10:45:20 AM »
House Maintenance- $20.83
Unless you're not including repairs (HVAC, roof, etc.), this seems quite low.

We have a several thousand dollars already set aside and earmarked for the HVAC, which is very likely the next thing to go out.  The roof is three years old, so I'm less worried about that.  But you're right this is too low and it's in our short-term plans to address this.
Why wait until the HVAC "goes out"?

Here are some typical numbers for a 1600 sf house in Alabama
Current A/C electric cost: $1,460 per year
New A/C electric cost: $730 per year
New unit cost: Maybe $5,000.  Google says $4,820 to $9,350, I'm assuming it scales by efficiency of your unit

So that's like a guaranteed 15% return!  You can even go higher efficiency on  the new unit and get the electricity usage down to $464 per year. 


Sources & assumptions:
7 SEER current HVAC rating, 14 SEER replacement, 3 ton unit, in Mobile, Al
https://www.seerenergysavings.com/
https://www.we-sell-ac.net/ac-package-unit-learning-center-ac-sizing-calculator1.php

Sugaree

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Re: What expenses can be cut?
« Reply #41 on: May 18, 2021, 11:32:00 AM »
Overall, your budget seems pretty reasonable.

The one thing that jumps out for me is your 1989 hvac unit is probably why your kWh is so high. For example, last July we used 2125 kWh for a 3300 sq ft house that has 2 hvac units in Georgia. We replaced our 1988 units a couple of years ago and went from almost 4,500 kWh to about 2,000 in the summer.

I think that this is likely the major culprit in our power bill being so high.  We've got some cash set aside specifically for this replacement and have been researching exactly what we need.

Have you thought about putting in your own AC units? I got a $6000k quote to change my central airl units. I am moderately handy, and so I used a company called Alpine Home air - I bought the equipment for $930. I had to buy a couple of tools from harbor freight so all in the job was $1.2K.  I did my first one in 2013, and then the upstairs one went last year and i changed that too. Both still work really well.  I used the special solder, so I didnt even have to braise..... AC people sell it as complicated - if you can work on your own car - it is def something you can do yourself.

That's actually the plan.  One of my husband's friends is an HVAC tech and we'd get him to help us. 


House Maintenance- $20.83
Unless you're not including repairs (HVAC, roof, etc.), this seems quite low.

We have a several thousand dollars already set aside and earmarked for the HVAC, which is very likely the next thing to go out.  The roof is three years old, so I'm less worried about that.  But you're right this is too low and it's in our short-term plans to address this.
Why wait until the HVAC "goes out"?

Here are some typical numbers for a 1600 sf house in Alabama
Current A/C electric cost: $1,460 per year
New A/C electric cost: $730 per year
New unit cost: Maybe $5,000.  Google says $4,820 to $9,350, I'm assuming it scales by efficiency of your unit

So that's like a guaranteed 15% return!  You can even go higher efficiency on  the new unit and get the electricity usage down to $464 per year. 


Sources & assumptions:
7 SEER current HVAC rating, 14 SEER replacement, 3 ton unit, in Mobile, Al
https://www.seerenergysavings.com/
https://www.we-sell-ac.net/ac-package-unit-learning-center-ac-sizing-calculator1.php


The truth is that my husband has had some major health issues over the last two years so the only things that have been getting fixed are the things that are broken.

Morning Glory

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Re: What expenses can be cut?
« Reply #42 on: May 18, 2021, 02:22:51 PM »
Overall, your budget seems pretty reasonable.

The one thing that jumps out for me is your 1989 hvac unit is probably why your kWh is so high. For example, last July we used 2125 kWh for a 3300 sq ft house that has 2 hvac units in Georgia. We replaced our 1988 units a couple of years ago and went from almost 4,500 kWh to about 2,000 in the summer.

I think that this is likely the major culprit in our power bill being so high.  We've got some cash set aside specifically for this replacement and have been researching exactly what we need.

Have you thought about putting in your own AC units? I got a $6000k quote to change my central airl units. I am moderately handy, and so I used a company called Alpine Home air - I bought the equipment for $930. I had to buy a couple of tools from harbor freight so all in the job was $1.2K.  I did my first one in 2013, and then the upstairs one went last year and i changed that too. Both still work really well.  I used the special solder, so I didnt even have to braise..... AC people sell it as complicated - if you can work on your own car - it is def something you can do yourself.

That's actually the plan.  One of my husband's friends is an HVAC tech and we'd get him to help us. 


House Maintenance- $20.83
Unless you're not including repairs (HVAC, roof, etc.), this seems quite low.

We have a several thousand dollars already set aside and earmarked for the HVAC, which is very likely the next thing to go out.  The roof is three years old, so I'm less worried about that.  But you're right this is too low and it's in our short-term plans to address this.
Why wait until the HVAC "goes out"?

Here are some typical numbers for a 1600 sf house in Alabama
Current A/C electric cost: $1,460 per year
New A/C electric cost: $730 per year
New unit cost: Maybe $5,000.  Google says $4,820 to $9,350, I'm assuming it scales by efficiency of your unit

So that's like a guaranteed 15% return!  You can even go higher efficiency on  the new unit and get the electricity usage down to $464 per year. 


Sources & assumptions:
7 SEER current HVAC rating, 14 SEER replacement, 3 ton unit, in Mobile, Al
https://www.seerenergysavings.com/
https://www.we-sell-ac.net/ac-package-unit-learning-center-ac-sizing-calculator1.php


The truth is that my husband has had some major health issues over the last two years so the only things that have been getting fixed are the things that are broken.

I'm so sorry you're going through this. We had similar experience with health issues causing us to let the house maintenance slide, which was depressing to live with and overwhelming to fix. I'm glad you have a friend who can help with the HVAC.

 

Wow, a phone plan for fifteen bucks!