Trim your monthly spending with these easy steps

When Yale graduates Thomas Smyth and Daniel Petkevich scanned each other's credit card bills, they were surprised by what they found.

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Petkevich was paying for renter's insurance for an apartment he hadn't lived in for two years. Smyth was being charged monthly for subscriptions to the streaming service Hulu and video-sharing website Vimeo Pro -- and he wasn't using either.

"We realized this is small problem for us, and a small problem for a lot of people, but the emphasis is on a lot of people," Smyth told CTVNews.ca.

Smyth admits poring over someone else's credit card statement was "totally weird and quite intimate," but it seems to have paid off.

The duo recently launched the San Francisco-based startup Trim, a service that helps you track your monthly subscriptions, and easily cancel any that you don't need.

Small charges add up

Smyth said the typical Trim user has seven to eight subscriptions and often cancels one through the service, saving about $15 a month, or $180 a year.

On its own, the amount may seem inconsequential, but financial experts say making minor changes to your monthly budget often add up to major savings.

"It's the small things, what we refer to as leakage," said Scott Hannah, CEO of the Credit Counselling Society.

Hannah said most individuals can account for about 80 per cent of their spending, and that usually covers the major expenses such as mortgage payments, taxes and insurance payments.

It's the remaining 20 per cent of spending where small adjustments can add up, he said.

Hannah said replacing a daily latté run with coffee you make at home can add up to $1,800 in savings at the end of the year.

"You have to put it in a bigger perspective," he said. "What's the annualized savings, what's the difference I can really make?"

Using himself as an example, Hannah said he cut his cell phone, Internet and home phone bill down from $200 a month to $120 by bundling the payments through one provider. The savings add up to nearly $1,000 a year.

When it comes to insurance payments, Hannah said paying monthly comes at a premium, but paying the annual amount upfront often results in savings of about $150 a year.

Ontario-based financial advisor Sandi Martin of Spring Personal Finance said the first step in cutting back costs is tracking what you're spending.

Watch out for 'miscellaneous spending'

"Almost everybody has their credit card statement, or their bank account statement, and it's not too much work to go back and reconstruct an average of how much you spent over the last three months," she said.

She said, what often surprises her clients who take a closer look at their budgets is the "miscellaneous spending."

While those tiny transactions may seem very inconsequential at the time, they often add up to one big line-item in your budget.

"There's really no fulfilling sense of having gotten anything out of spending that money," Martin said. "You don't really know what you got out of spending $15 at a convenience store."

She said giving yourself "an allowance" for these smaller purchases is an easy way to curb those habits.

Martin added that individuals often get into a habit of continually paying for certain bills without shopping around.

"Never assume that my cell phone bill is my cell phone bill, or my home insurance bill is my home insurance bill, and not really dig into the details of what you're getting for that money."

She said bank account fees are another area where you may be able to find some quick savings.

"You can find some pretty savings if you approach your bills with a questioning attitude," she said.



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