Monday, August 3, 2015

Crisis Averted. Pretty Much . . .

The car insurance crisis is pretty much averted.  After feeling all-out stupid for forgetting about my car insurance altogether, I tinkered with the budget again this morning, and now have a workable solution. Not ideal, but workable.  I have a Christmas Club at my credit union which I use for presents and charitable donations at the end of the year.  I didn't think I could do this, but it turns out that I can - I dropped the monthly amount that I save in the CC down by 30-odd dollars.

With the $50 give/take surplus that I had last Friday until I got home and got the mail, and the change in my CC I am now coming in with $2/month to spare.  Yay!  That's cutting it really close, but I'm not in the red and I'm praying that I haven't forgotten any other important expense(s).  It's going to be an interesting balancing act for the next few months, that's for sure, but I'm up to the task.  I'm also considering reducing the percentage that goes into my 401(k) to give myself a little more breathing room on a monthly basis.

This sounds like a very stupid idea until you learn that, where I work, they only match a very small amount and it doesn't go up the more I contribute.  As long as I meet the contribution percentage they specify, I get the small amount they match.  I'm well over that specified percentage.  I don't really want to do this, but it's something I am considering.  Thankfully, I don't have to make that decision immediately - and, hopefully, not at all.

I do, however, have to pay the current car insurance bill in the next couple of weeks, and I don't think it truly qualifies as a bonafide emergency - I mean, no one is bleeding, no bones are broken, and death of any sort is not involved, but it may be that I have to touch the emergency fund for this. I mean, you cannot drive without insurance - that's lunacy (as well as being illegal), but I've got an idea or two up my sleeve and I'm going to try a few other things before touching the emergency fund.


Linda said...

Yikes that the car insurance thing didn't occur to you earlier in this process! Are there any other possible expenses like that you can think of now? Home insurance? Life insurance? LTC insurance?

I have a line item in my budget for the latter, although the bill only arrives once a year. I pay both car and home insurance (now it's renters insurance) monthly. There's a one dollar service fee to do this, but it's worth the $12 a year to me since it keeps my insurance always in my monthly recurring expenses instead of in the semi-annual category when I'm likely to forget about it, too. (Besides, I have the monthly cost of home + auto + umbrella insurance charged to rewards credit card, so the cash reward I earn on that transaction pretty much covers the service fee I'm charged.)

I do hope you find something else to sacrifice in the budget so you can continue to contribute the maximum to the 401(k). Even though my employer doesn't match a large amount of my 401(k) contributions, I'm still putting in the maximum allowable amount. I want to be amply prepared for the years when I may not be able to work like I do now.

Anonymous said...

Seconding everything Linda (#1) said: can you pay your insurance bill in monthly installments? And can you please try to protect your 401(K) contributions to the bitter end? That is the money you will need to live on later, and every good budget/investment/retirement planning tool suggests "pay yourself first" - even if it means you have to give up the Christmas Club completely for a few years. -- Linda M.