I renewed my yearly car insurance and road tax today, and I finally got around to negotiating with the insurance agency to lower the covered amount. It took a little effort, checking with a secondhand car dealer or on the prices of my car's model and year, and then pushing for the lower figure on the range provided.
The amount negotiated came up to RM239 where the previous year I paid over RM200 more than this. At the same time, due to initiatives to benefit the 'lower income' group by the Government, lower literage cars are getting cheaper and cheaper to maintain (petrol subsidies for RON95 and lower road tax) - I paid RM20 for my road tax.
I had budgeted RM500 for this yearly event but in the end saved around half of this amount.
Oftentimes, the second largest expense in a household (before the kids come) is the costs associated with owning a car. Therefore, sometimes it makes sense to focus on this major expense and see where significant actions can be taken to benefit on the individual than to constantly just focus on the small expenses like lunch spending, iTunes purchases and the occasional sushi meal.
One main area is related to how petrol prices keep on rising as conflicts in the middle east and fears of shortages in supply for the future maintain the upward pressures. Travelling is expensive nowadays. For a part of my working life, I car pooled with a colleague and it was during that year where I saved the highest % of my income.
When I do drive, I decided on a car which was small, convenient and could get me from point A to point B. It wasn't prestigious and didn't give me a sense of pride as I drove around clients who visited the company but it got the job done. I made sure it got regular service and it has not broken down on my once for over seven years. At the same time, I'm a bit embarassed to admit that I've conditioned my body to not sweat when I drive without any airconditioning and I leave the windows up to reduce wind resistance...but that's probably taking it a bit too far (at least I switch it on when there are passengers!).
All the above has helped me avoid unnecessary spending on such a large expense area. Am I tempted to get a nicer car? Absolutely. But I'm not feeling the pinch enough to part with my trustee vehicle until it starts breaking down on me regularly.
I've actually become rather fond of it.
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