If you don’t own a car, feel free to skip to the next section (if you do, this may very well be your most expensive recurring cost)!
If You Own A Vehicle
As with phones, I always recommend that people pay for vehicles in full because it avoids adding recurring expenses. I recognize that not everyone can afford this; if you can’t, try to put as much money down as possible. I strongly recommend against buying a brand-new car because it depreciates the second you drive it off the lot! Buy a certified refurbished or low-mileage, used vehicle instead. Remember: the longer it takes to pay off your car loan, the more it will cost you due to interest.
Try to do the maintenance yourself—it is straightforward and worth the extra five minutes. You don’t need mechanical knowledge to do this. Learn how to check your oil, fluid, and tire pressure levels; otherwise, it will cost you as much as (if not more than) $100. Learn how to do it, and do it yourself! If you take your car to the shop every 3-6 months, it will add up (I take my car to the shop once every 2-3 years for maintenance that requires a lift).
Regarding fuel costs, consider buying a used hybrid—but don’t overdo it. If you’re only driving a mile or so per week, I can’t honestly say that it will save you money (I strongly support eco-friendly transportation options, though). If you plan on an enormous amount of traveling, consider the miles per gallon usage of the vehicle. If you’re driving very little, you should pay more attention to the overall cost of the car itself (the MPG will likely never be worth the extra charge). As a real estate agent, I drive extraordinary distances quite frequently. Knowing this, I bought a used 2013 Toyota Prius because I totaled my 2011 Toyota Prius it has both accessible refueling and excellent gas mileage! Plus, it’s relatively eco-friendly.
Assuming you buy a used car, if you have any issues with your vehicle, take time to find a good (read: honest) local mechanic and use them for maintenance and repairs. Taking your car to a dealership is generally only in your best interest if a mechanic explicitly recommends you do so (occasionally, dealers are the only ones to diagnose the issue). Dealerships often charge 2-3 times as much as an independent repair shop.
The secret to reducing expensive repair costs after a minor car crash or parking “mishap,” for example, is much less complicated than most realize. First, figure out the problem (which may involve taking the vehicle to a shop for diagnostics) and write down the associated part numbers for items needing replacement. Then, order the parts online, ideally refurbished or lightly used OEM (original equipment manufacturer), on eBay or a similar online retailer. Alternatively, you can buy them in person from a spare parts garage, such as LKQ Pick Your Part, or a retailer like AutoZone. Complete the repair by taking them to your local mechanic and requesting that they only charge you the installation service fee. I guarantee you will save money—sometimes thousands of dollars—by doing it this way. Suppose it’s a major repair that you are unable to handle. In that case, you may want to report it to your insurance company and consider the car totaled (this will cost less than trying to repair it under certain circumstances).
If You Use Public Transit
It’s great if you don’t need to own a vehicle, though! Transit varies substantially based on where you live in Maryland. In urban areas such as Towson and Silver Spring, it’s possible to avoid owning a car and relying on public transportation entirely; it’s the most affordable option, but only if it works with your lifestyle. Consider buying a bus pass, so you’re not paying the full fare each time you ride. Also, consider pairing a bike part of the way.
Remember: most transit options have carriage capabilities. In other words, you can typically latch your bicycle directly onto the bus or train, allowing you to ride part of the way and use public transit the other. Consider both options before buying or renting your next residence; it’s much easier to adapt your mode of transportation beforehand. For more information on transportation, bus routes, and maps, check Maryland Moves’ resources list on the main menu.
Again, I could have put this as the most expensive category, but it depends primarily on how much you eat and if you have a large family.
This article’s intent is how to save money, not how to save time, so I’m going to talk less about your proximity to grocery stores or the amount of time you spend shopping. They are both valid considerations! Suppose you spend over three hours per week buying groceries. In that case, consider utilizing a service such as Instacart or HelloFresh, which charge a premium but save you a remarkable amount of time.
Maryland has many respectable options as far as grocery stores. Though there are many fresh and local organic markets, these are not typically the cheapest places for produce; they are often the most expensive! Because of this, I don’t list these as venues for saving money, though I completely respect those who value local and sustainable grocery options.
Although there will be some cases where the following statement is not entirely accurate, I can confidently tell you that the cheapest place to buy groceries in Maryland is between Aldi and Lidl (pronounced “lee-dull,” folks) and Walmart Supercenter. For specific items, Costco can occasionally be worth it, but only if you have a great reason to buy in bulk. Regarding single-use, everyday groceries, stick to the main three mentioned above. If you live close to one, you should go to that one (the sub-$1 difference isn’t worth the haul).
Checking item prices online can be helpful, but only if the vendors list their prices online. It frustrates me when they don’t, but I recognize that specific locations have different pricing than others (this is also worth noting).
Locals seem to perceive Aldi and Lidl have lower-quality items, but this is different. If they had a single experience that would indicate otherwise, I’d recommend that they try again—it’s not a luxury experience, but if that was your goal, there are better posts for you! Overall, I’ve found that the quality of Aldi and Lidl is just as good, if not better than Walmart and other low-cost vendors. Items cost as little as half the price of something you might find at a grocery store, such as Giant or Safeway. If you choose Aldi, be sure to bring a quarter!
Honorable mention goes to Dollar Tree, which has outstanding prices but is not technically a grocery store.
This category is a bit tricky. As far as health insurance is concerned, if you are currently unemployed, you may need to register under Medicaid; if you do have a job, the recommendation is to use your employer’s medical insurance. It will almost always be significantly cheaper than private insurance.
Auto insurance only applies if you own a vehicle. If you have an affiliation with the military, USAA might be your best option. If not, you should shop around for the best insurance rates. Alternatively, you can use Maryland’s state-sponsored auto insurance, which you can read about here.
Regarding renter’s or home insurance, I recommend you shop around and choose the best option. Renters insurance is excellent to hold and may be required. Homeowner’s insurance is somewhat similar: shop around and find the best choice for your needs.
Above all other things, paying off your debt should be the number one priority in your life (offer my sincerest apology to your partner). Waiting to pay them will (not can—will) be detrimental to your future 100% of the time. Pay off your debt as soon as you can. Seriously, pay off your debts. Please do it!
If you don’t pay off your debts, interest will accumulate every consecutive month, growing over time (often to the tune of thousands of dollars). I recommend you only finance something if you absolutely must, such as a home purchase. This situation also occurs for student loans. These options are great, and because they provide incredible value to your life, you should consider them! But you should only maintain a balance on your credit card for up to one month.
Your credit card should not hold a balance, period! If you have a balance, you are financing one thing: the credit card company’s profit. Credit card companies make money by holding a balance, so don’t let them get you! Pay off your entire balance before its due date every single month without fail. Missing payments, holding a balance, and spending too much money can all be detrimental to your financial future, so if you feel like these will ever be something you may accidentally do, don’t get a credit card.
If you feel responsible enough to learn and diligently hold one or more credit cards, you have a good chance at increasing your credit score, reaping reward points for your purchases, and utilizing their many perks. But again, none of that matters unless you pay off your balance in full every single month. If you’d like to learn more about credit cards, check out this article.
There are many other recurring costs on a smaller scale, such as online streaming or music subscriptions, laundry, and parking (which I discuss in detail here). Write all of your other recurring costs down and ask yourself if you genuinely use them enough to justify their cost. You should consider removing those costs or sharing them with someone else if you don’t. You need to find the number of expenses you can cut, so start looking! Be honest with yourself, and you’ll do just fine.