Capturing Missing Money

When I started shifting from a working environment to an early retirement mindset, one of the things that I have enjoyed most is capturing what I call “missing money.”  Missing money is my term for money that should belong to you but that you are not benefiting from.  With the proliferation of a lot of tools for managing things online, internet banking and other things, missing money is becoming easier to capture.  Think of it as plugging leaks in your budget.  Below are some areas to look for missing money:

–The government — are you giving the government an interest-free loan by over-withholding in your paycheck and then claiming a big refund each year?  If so, the funds should be earning money for you, in an interest bearing account.  I have had friends and co-workers tell me that they like over-withholding because they see this as a forced savings plan.  My recommendation is to open an online savings account and have the money automatically deposited to this account each pay period.

–The cell phone service provider — I recently switched our cellplan coverage to one with a much lower amount of monthly minutes. After studying the usage pattern, I realized that I was overpaying and accumulating a large amount of rollover minutes.  With skype and other services, I have shifted a lot of calls away from the (still needed) cell phone.

–The bank — do you have significant balances at the bank that aren’t earning any interest or very low rates of interest.  Or worse, are you paying monthly charges for services that can be obtained for free at another institution?  These days, banks, especially on-line banks and credit unions are becoming increasingly competitive to offer reasonable rates of interest on bank balances.  Although rates seem quite low now, they are likely to go up over the next year.

–Recurring monthly charges that you’ve cancelled — I used to have a subscription to an internet service provider as a backup in case the main internet went down.  I might have used this once in about 2 years.  However, even after I cancelled the service, they continued to charge my credit card for many months.  Finally, I had to have the credit card stop payments to this.

These are just a few examples of missing money that can add up month after month.  Just remember to bank the savings.

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