Sunday, November 21, 2010

Changing Expenses for Next Year

So just as I was feeling all smug about keeping my ongoing expenses down, my benefits changed at work (or will change as of Jan 1). Overall, the new benefits are much better than the old. I am truly grateful to my company, as they are adding long-term disability as a benefit! Something I pay $1400 for a year right now. Of course I'll have to buy a small supplemental policy, but it should shave like $100 off my monthly costs. So that's great.

The insurance is also a much stronger plan, except of course in my case because my therapist is out of network. If she were in-network, this plan would be a dream. But since she's not there is a HIGH (2K) deductible and the worst part is that the initial plan year is only 5 months. So to continue seeing my same therapist I am going to have to bite the bullet. It's going to cost me $2300 for the first five months of the year, and that's for only 3 visits a month.

That said, I can still afford it, and to me, it's worth it, although it is a steep price. I am going to use that time to really work hard and hopefully not need as much therapy, but also to find an in-network therapist that I can switch to in June.

I will take advantage of the FSA, so at least I will be paying this big bill in pre-tax dollars.

I will have a ton of deductions from my paycheck:
Transit Reimbursement

That will over all help to lower my tax bill, and hopefully I will barely pay anything for health expenses in post-tax dollars.

Friday, November 12, 2010

One Time Versus Ongoing Expenses

So I've been talking about how all year I've been spending a lot of money. Or what for me feels like a lot. But I realized, as I contemplated buying another pricey item, there is one thing that saves me from overspending. And that is that these expenses (except for my health care expenses) are one-time expenses. So my friends who pay $600 more a month than I do in rent pay that every month. That's a total of $7,200 a year. That's two sets of furniture, or a whole lot of clothes. Or two vacations. The good thing about one time expenses is you pay up front and then get to use the items/service. So you don't have to continue paying, even though you might continue consuming them. Like with clothing. Or furniture. So while these items depreciate, at least you only have to pay for them once.