Wednesday, July 1, 2015

Money Matters: Five (5) Ways To Save P500K in 10 Months To Pay Off Our Policy Loans!

By: Mhe-anne L. Ojeda - Isidro

My hubby Red has little tolerance for having debt. So when we discovered last June 1, 2015 that our policy loans of P500K remain unpaid, he suggested that we use our current Holiday Savings Fund (the P200sP100s and all loose coins collected into small yellow tin can and deposited on our joint passbook savings account every 15th and 30th of each month) to pay off the loans and refrain from taking trips abroad in the meantime. I said, No way (silently)! 

Don't get me wrong. Though not required, I want us to repay the policy loans (so that the cash surrender value of the ten (10) policies I got when I was still single, will not be reduced by the amount of the loan plus interest). But I still want us to enjoy a good life while doing so. I want us to be able to take our Summer and anniversary vacations in September while paying off the loans from June 2015 until March 2016. But I know this means we should save money by changing our lifestyles, cutting our cost every chance we get, and keeping track of our spending to find ways to reduce or eliminate unnecessary expenses. 

Here are the  Five (5) Ways we are adopting to Save Money to pay off policy loans in the next 10 months...

1. Our Savings Bottles Plan. This is very similar to how we build up our Holiday Fund Savings Account with a little twist. I have five (5) containers - the P200 bills still go into the yellow tin can for our holiday fund, the P100 bills are collected for policy loans payment, the P10 coins go into Red & Mhe's bottle for anything that we want to buy guilt free, P5 coins are collected for fun entertainment, and the P1 coins for eating out. I know that the amount is not much, but it adds up quickly and we are still able to live a good life while trying to pay off our debt.

2. "No IMAX movies". Red is a sucker for movies and he wants to watch movies every Friday on IMAX which cost P450 each (or P400 with our Tap To Pay Card). This means that we spend P4000 every single month on combo movies with snack. We decided to just watch movies at condo on our 42' inches TV with skycable and utilize snacks from the fridge.

3. "Don't Buy Just Because It's On Sale". This ones for me! I love to buy new clothes or shoes whenever I see the word SALE and this translate into spending  about P4000 to  P5000 on a monthly basis even though the clothes or shoes are on huge discount. 

4. Adopt a Hearty Receipt System. Just because I have two (2) heart-shaped boxes where we keep the receipts for GROCERY and OTHER lifestyle expenses (while hubby continue to keep other receipts). This way we will know where our money is going and make adjustments where needed. Since a huge chunk of our budget goes to food, we decided that we will eat at home more often.

5. Buy Bread at French Baker At 8:30PM. Red loves bread, and I am lucky to learn that French Baker at Cash & Carry sells all their breads at 50% off, thirty (30) minutes before closing time on a daily basis. But you must line up by 8pm to ensure that you get the breads that you really want. Hubby loves bonnet raisins and cinnamon rolls so I line up at least once a week.

This list will  surely grow as I am on the look out for some more frugal ways to save some money. With this five (5) ways, we were able to pay the first policy loan amounting to P54,000 last June 29. Yeahey!