I’ve been bringing my lunch to work for several years. I even brought lunches when I was in grad school. I’m on a medically restricted diet, so packing a lunch is necessary for me, but I would probably do it even if I didn’t have to. My husband was resistant to the idea of bringing his lunch to work until I showed him that the unhealthy, poor-tasting lunch he bought every day was costing us $2000 a year. Now he brings a lunch most days.

Comparative Cost for a Brown Bag Lunch

The main reason people consider brown bagging is the cost savings. If you go to Subway and get a 12 inch sub with avocado and no sides, it will set you back costs $7.90. And that’s one of the healthier options available. You also have to drive there, so factor in a few cents for gas.

By comparison, this is the cost of my food for the day while I’m at work:

Fresh oatmeal with raisins, brown sugar, and cinnamon: 25 cents
14 almonds: 10 cents
Tangerine: 20 cents
Yogurt with flaxseeds and cinnamon: 45 cents

Corn tortilla: 12 cents
Deli turkey: $1.37
Cheddar cheese, 1 ounce: 15 cents
Lettuce, 1 leaf: 3 cents
Chips, 1/8 ounce (for the crunch): 6 cents
Chocolate, dark, 1 square: 10 cents
Mustard, 1 packet: free from the break room

Carrot sticks: 30 cents
That brings my grand total for three snacks and lunch to $3.13. My husband opts for more fruit, a French roll, and fewer snacks, but it’s approximately the same cost. This includes the high-quality Boar’s Head deli meat, not some tasteless meat in a package. It tastes better, and it’s healthier. I drink water all day, but both our offices provide free sodas if we want them. If yours doesn’t, a canned soda will cost about 33 cents if you buy a 12-pack from the grocery store and bring a can to work with you. That’s at least half what it would cost to buy one from a lunch place or convenience store

My lunch and snacks cost about $765 a year, compared with the $2000 or more I would spend eating out every day.


In addition to costing less, my food is more convenient. I can eat lunch at the same time, instead of waiting until I have time to drive or walk somewhere. If I want to go to lunch with colleagues, which both my husband and I do on occasion, I have my lunch ready for the next day. Lunch with colleagues on occasion is good – it reminds people you’re around and improves your networking skills. However, once every week or two is enough.


Bringing your lunch is also healthier.

  • I’m less tempted to eat the junk people bring into the office because I have my snacks with me.
  • You control the amount of fat and sugar in your meal. That’s why I bring only an eighth ounce of chips. It’s enough to satisfy my desire for salt and crunch, but only 1 gram of fat.
  • You control your portions. Many people eat way too much when presented with a restaurant or fast food meal. Bring your own and you’ll eat less.


My office park has a few nearby options, but my husband’s old office had very few, so he ate awful food most days. When you bring your lunch, you have more variety. Some days I’ll bring leftovers. I also vary what goes in the wrap or bring peanut butter and rice cakes instead. I bring whatever fruit is in season. My husband varies the flavor of yogurt he brings. If he gets up early enough, he might pack a small salad to go with his sandwich.

I pack my lunch in the morning while I drink my protein shake. It only takes a few minutes to throw together and then I have food for the whole day. We both have insulated lunch bags with mini ice packs. Once I get to work, I put the stuff that must be chilled into the fridge and take the bag to my desk so my dry snacks are nearby. I use the same resealable baggies every day for a week to further reduce the cost. I assemble my wrap just before lunch, but my husband makes his sandwich in the morning.

I suggest trying this for one week. Once you see how much better you and your wallet feel, you’ll be convinced.

Bonus points: most people will be impressed by how delicious your lunch looks and how healthy you eat. They’ll comment that they should do the same. Just smile and agree.

Green Panda Treehouse featured me in this week’s Carnival of Personal Finance. Among the rides she offers are investing advice, saving advice, credit card advice, and debt advice. Don’t forget your E-tickets.

The BagLady is hosting the Carnival of Debt Reduction this week. Her links are organized into tips for avoiding debt. Be careful before you enter her hall of mirrors.

If festivals are more your style, check out On Financial Success for this week’s Festival of Frugality. On Financial Success offers a bevy of links about finding that very thing, including a post from me!

Apparently the third Monday in January is the saddest day of the year. Researchers determined this because this is the day you’ll receive holiday credit card bills and this is the day most people realize those resolutions have failed. Here are some tips for renewing that resolution to get in shape without busting your budget.

Find a Gym Near Your Office
If you ran out and joined a gym near your house, see if they have a branch near your office that you can either switch to or use as well. That way you can visit the gym on your lunch. Not only does it fit well into your schedule, but you’ll find that you’re more productive in the afternoon. I’m fortunate that I can walk to my gym, but if you don’t have one in walking distance, look for a five-minute drive or less. That will give you enough time to do some real exercise.

Get a Guest Pass
If you haven’t already joined a gym and want to, ask for a one-week guest pass before you join. If you don’t use your guest pass much during that week, don’t join the gym. You can get fit with other options instead

Join with Family Members
Family members usually get a discount, so have yourself added to your spouse’s membership if you’ll actually visit that gym or chain. Not only can you encourage each other, but the second membership will be cheaper and probably won’t require start-up fees.

Ask for a Discount
Gyms are always running specials. Ask for one. If they don’t give you a good deal, walk away. Then go home and research offers online. Most chain gyms display their offers right on their website. Print it out and then go back to talk to the manager.

Hire a Trainer for a Few Sessions
Trainers are expensive, but I was in the best shape of my life after working with a trainer once a week for six months. Alas, I couldn’t maintain the expense, but I did hire one for five weeks recently to show me how to use new machines and learn new techniques. Most gyms have an introductory training special. My gym, 24-Hour Fitness, offer 5 sessions for around $50 for first-time buyers. Yes, you’ll get pressured to buy more sessions, but you can say no.

At the very least, take the free introductory session offered when you join. They’ll cover the basics on using the machines and recommend the right machines for you. Don’t watch other members to learn how to use them because most people use them improperly. At best, you won’t see much improvement. At worst, you’ll get hurt.

Trainers will also help you fine-tune your cardio exercises. Most people do that wrong, too. You don’t have to go at top speed the whole time. In fact, you’ll lose more fat if you vary the pace and change machines from time to time.

Quit if You Hate It or Don’t Go
Most gyms have a cancellation fee, but that fee is much lower than the cost of continuing to pay out the rest of your contract. If you’re simply not going to go, bite the bullet and pay the cancellation fee.

Exercise at Home
As I mentioned yesterday, it’s possible to get in shape at home. All you need is a plastic stool and some free weights. You might also want resistance bands or a balance ball. You can find most of this stuff at Target or a local sporting goods store. Watch the Sunday newspaper ads for sales, or check online. Free weights are usually $1 a pound, but I’ve found them for half that during sales. I recommend the neoprene-covered weights because metal weights can be slippery. Now go online to women’s magazines, men’s magazines, and fitness sites to find free workouts you can print out. Some sites allow you to enter some data to customize them to your needs. Look for routines with pictures or videos so you can see how to do the moves properly.

If you have cable, check your On Demand menu. Mine has several exercise programs, and some of them are very tough. Try several until you settle on one you like. Since these programs are already included in the cost of your cable, this is a free option. Most of the shows don’t require any accessories. You can also check your library for exercise videos.

If you don’t want to exercise at home or at a gym, consider walking. All you need are walking shoes, a ski hat for colder days, and maybe a sports bra for women (change in the office bathroom.) Most walkers don’t work up a sweat, so you won’t need to shower afterwards. You can easily do it on your lunch hour. If you live in a wet or snowy climate, you can also walk in the mall. Just make sure you leave your money and credit cards in your office, not in your wallet!

Consider Buying Wii Fit
If you already have a Wii, then consider getting Wii Fit. It’s expected to cost around $70 and release later this month. It offers a variety of programs and will track your results. You can also compete with family members. It’s definitely cheaper than joining a gym if you already have a Wii. If the Wii is in your family room, it’s also harder to avoid than the gym.

I work out part time at the gym and part time at home. The combination works well for me. Even if you don’t want to spend a lot, you can find a way to get in shape and keep your budget in good shape, too.

There are a few TV shows I love. I make an appointment to watch them every week, but I don’t watch much TV beyond those. But now I have a problem – because of the writer’s strike, most of those shows I watch are off the air. A few of them have only recently started, but I know they’ll be gone in a few weeks, too. I’m so accustomed to watching TV at a certain time that I find myself endlessly channel surfing just looking for something to watch. That has to stop, but I don’t want to spend a lot of money going out to movies. It’s too cold to engage in outdoor activities, so I’m stuck inside looking for stuff to do that doesn’t involve the computer.

Here are a few of the ways I came up with to reduce my total entertainment cost now that there’s so little good TV to watch:

Subscribe to Netflix or Blockbuster Online
There aren’t many TV series I want to watch that I haven’t already seen, but you can get full seasons of TV shows from Netflix or Blockbuster online. I’m thinking of adding season one of “Psych” to my list because I’ve only seen some of them. Then you can watch them one hour a day to fill a slot where you used to watch some other show. You can also catch up on all those movies you’ve been wanting to see, but missed in the theater. I figure that we can watch 100 movies this year if the strike goes through the fall TV season. It’s certainly better than “American Gladiators.”

I know, a lot of people don’t like to read. Fortunately, I’ve been a voracious reader my entire life. Currently, I have a pile of 26 books that I’ve been meaning to read. I own them, but I got most of them for free at various events. The local library is one reason I haven’t gotten through them. Whenever I hear about a book, I order it online from my library system, and then I can pick it up a few days later. The downside to having such a huge library system available is that I’ve ordered so many library books that I haven’t had time to burn through my TBR pile!

If your kids think reading is boring, let them choose the book, and then read it together as a family. You can all read aloud, or you can read one chapter a week together and set a time to discuss it. I hear the latest Caldecott winner, Brian Selznick’s “The Invention of Hugo Cabret,” is a big hit with kids. Your library may have a waiting list for it, but the librarian can recommend alternatives while you wait.

Take Up an Inexpensive Hobby
Besides, reading, you could also take up a few inexpensive hobbies. If you’ve always wanted to learn to cook, get some cookbooks from the library and teach yourself. Visit an art store and buy inexpensive art supplies to practice painting, ceramics, or another hobby. I don’t recommend scrapbooking if you want to be frugal, but you can find other options.

Since there’s nothing good on, why not go to the gym? If you have a low stool and a couple free weights, you could work out at home instead. My cable provider offers free exercise classes in the OnDemand section. You can also find free online routines at many women’s magazine sites like Self and Women’s Health. You could test-drive videos through your Netflix or Blockbuster account or the library. I use a printed out routine and watch the Food Network while I workout at home. For some reason, it motivates me.

Play Board Games
I have several board games, ranging from Checkers to Risk. If you have a simple dominoes set, you’ve got several games right there. These are fun all night long and also count as quality family time. Schedule a game night with some good munchies and I doubt you’ll hear many complaints. I loved playing games with my family when I was a kid. I still do.

Attend a Free Cultural Event
Sometimes, the local symphony will hold a free family night, or the library or bookstore will hold a reading. Pack up the family (for family appropriate topics) and take everyone along. If it’s just you and your spouse, you have more options to choose from. Find a free local paper and check the calendar section for upcoming events.

Invite Friends Over for a Potluck
Entertaining can be expensive, but not if you ask everyone to bring something. Every time I have people over, they always bring food even if I don’t ask. This way, you can suggest a course so you don’t have six entrees and a bottle of wine. As a bonus, you can keep the leftovers and have food for a few more days!

These are just a few things you could do to reduce the entertainment cost section of your budget. I’m sure if you get off the couch, or away from the screen, you can find a few more frugal ways to entertain yourself and your family when there’s nothing to watch on TV – and even when there is. Consider this your opportunity to wean yourself from the box.

Yesterday morning NPR reported that the consumer price index had risen 4.1% since December 2006. They also reported that although wages have risen, they’re actually lower than they were in 2000 when adjusted for inflation.

I exhaled a stunned breath when I heard the first part. That’s a hefty jump for one year. According to NPR, it’s the biggest increase since 1990. When I heard the second part, I instantly felt poor and angry. I know my salary is higher than it was in 2000, but thanks to massive student debt and other debt, my husband and I both feel poorer than we did in 2000.

The continued rise of fuel prices is a big part of the problem for us. I drive less than 100 miles a week and have a fairly small tank, but pumping $29 into it when I used to only have to add $15 is frustrating. I have to fill it at least twice a month, so my fuel costs have effectively doubled in the last four years. When gas hit $3 the first time, it started to affect my choices. I now see some of my friends less frequently and attend fewer events because I don’t want to pay for the gas to get there.

Rising food costs also comprised a large part of the increase in the CPI. Those haven’t affected us as much because we don’t buy many wheat or dairy products, but it’s had some impact on our budget. The CPI was only up 2.4% when food and energy are excluded. Many economists choose to exclude those numbers because food and energy are not considered “discretionary spending.”

Now, realistically, when I look at my finances, I know I’m not poor, but I definitely don’t feel well off, or even completely secure. Our income has increased almost 1200% since we got married in 2005 (remember, we were both grad students, and thus actually poor. Not “top ramen for every meal” poor, but “spending all our money on groceries, gas, and books” poor.) We can put food on the table, we can pay our monthly bills, and we can even afford to live comfortably, but rising prices also make us feel more restricted in our choices.

Someday soon I hope that we’ll reduce our debt enough to a level where I will feel more secure even in the face of rising inflation and stagnating wages. Unfortunately, it’s hard to see that day coming when I hear news like this.

Winter comfort foods are the best. They fill you up, they make you feel warm inside, they’re comforting, and most of the time they’re cheap. Of course, you can make winter foods that much better by cooking them fresh. Not only will you reduce the calories and sodium, but it’s friendlier for your budget, too.

My Top Seven Winter Comfort Foods:

  • Homemade chicken pot pie
  • Chili with cheddar cheese and tortilla chips
  • Fish and chips
  • Turkey and bean soup
  • Jambalaya
  • Tuna casserole
  • Lasagna

All of these are delicious and filling. Most of them also include low-cost ingredients. Sure, you can buy most of these dishes frozen and heat them up, and you might even find a coupon for it, but comfort foods are so much tastier when you cook them yourself. Cooking them fresh will also warm you up because you’ll be standing over a hot stove or oven.

Low-Budget Alternatives
If you’re on a really tight budget, you can make most of these comfort foods even cheaper by eliminating ingredients. Meatless lasagna is still fantastic. Take the shrimp out of jambalaya to reduce the cost. You could also substitute red rice and beans instead of traditional jambalaya. I found a recipe in one of those “How to Eat French” books a few years ago that combines yellow rice, black beans, and sausage. He spices it up with cumin, garlic salt, gumbo file, and Worcestershire sauce.

For chili, you can buy fairly cheap cuts of meat, or make veggie chili, and beans are always on sale. You could make your own tortilla chips by cutting up corn tortillas and frying them. I sprinkle them with seasoning salt for extra kick.

Chicken Pot Pie






Homemade Chicken Pot Pie Recipe
This weekend, I had a craving for chicken pot pie – the ultimate comfort food. Rather than buy a Swanson’s pot pie, I modified a recipe from the Barefoot Contessa (which is unfortunately no longer available on the Food Network site.) The biggest change I made was swapping out her carrots and pearl onions for potatoes. I also cut the recipe in half. Here’s my version of the recipe:

2 skinless chicken breasts (about ½ pound)
Olive oil
Salt and pepper
2 medium white rose or Yukon gold potatoes (about a pound), peeled and cubed
2.5 cups chicken stock
1 chicken bouillon cube
6 tablespoons butter
1 yellow or brown onion, diced
6 tablespoons cornstarch
2 tablespoons heavy cream
1 cup frozen peas
1 teaspoon salt
¼ teaspoon pepper
3 tablespoons dried parsley or ¼ cup fresh chopped parsley
Frozen puff pastry, refrigerated savory pie crust, or homemade savory crust (leave out the sugar)

  1. Prepare the crust as instructed.
  2. Preheat oven to 375 degrees.
  3. Brush the chicken breasts with olive oil, season with salt and pepper, then roast or grill. Cube them once they’ve cooled.
  4. Peel and cube the potatoes. Steam or boil them until fork tender (about 15 minutes for steaming.)
  5. Dice the onion. Melt 6 tbsp butter in a stock pot, then sauté the onions over low heat until translucent (about ten minutes).
  6. Heat the chicken stock and add the bouillon cube.
  7. Add the cornstarch to the onions and stir for two minutes.
  8. Add the chicken stock and simmer for one minute, or until thickened.
  9. Add the cream and stir well for one minute.
  10. Add 1 tsp salt, ¼ tsp pepper, frozen peas, chicken, potatoes, and parsley. Stir well.
  11. Spoon into small pie tins.
  12. Layer crust on top. Poke with a fork to avoid bubbles. Arrange the pies on cookie sheet, then bake for 45 minutes to an hour, or until the crusts brown and the filling is bubbling.

I didn’t have large enough ramekins, so I used mini aluminum loaf pans that held a little over a cup of filling. The recipe made four servings. After they were completely cool, I covered two with aluminum foil, put them in freezer bags, and froze them for later. If you wanted eight pies, you could double the recipe. You’d also need a much larger stock pot.

All told, this recipe probably cost about the same as four frozen pot pies, but these were much tastier and healthier. To me, that’s an important part of comfort food. What are your favorite comfort foods?

I tend to buy a lot of produce, and if I bought all the fruit I normally like during the summer, my winter grocery bills would be insane. I’ve adopted a few measures to keep my weekly grocery bill in check without giving myself scurvy. Actually, winter is a great time to avoid scurvy because all those delicious citrus fruits are in season. I also shop for meats and other products that are seasonal to keep costs down.

Winter Produce
When I’m shopping in the produce section, I look for the fruits and vegetables piled in big bins. That’s the first clue that something’s in season. Then I look at the label. If it says it’s from Chile or anywhere else in South America, I don’t usually buy it. Even though I’m in Southern California, Chile isn’t exactly next door. I worry that the taste won’t be as good as local seasonal fruits, and of course the price is atrocious. Sometimes I’ll spring for Mexican fruits, because at least they’re in this hemisphere and it is right next door. But I can’t imagine how those imported fruits must look and taste by the time they’ve reached Maine. If you don’t know which fruits and vegetables are seasonal, visit a farmer’s market a few times a year or check out this seasonal produce chart at the Food Network.

Some foods, like lettuce, carrots, onions, and potatoes are available all year round where I live, so I buy those all year round, but I seem to want to eat more potatoes in the winter than in the summer. They are a cold weather vegetable, so that’s probably why. You’ll notice that the price drops a little around this time of year, which is great because heavy soups and stews are delicious on cold winter nights. This weekend I made homemade pot pies with potatoes, peas, and chicken. They were delicious and so satisfying.

Winter Meats
The second trick to reducing winter grocery bills is buying seasonal meats. Obviously, lamp is a spring meat. I will occasionally eat it during the winter for variety, but it costs a fortune because it’s usually imported from Australia or New Zealand. I’d much rather wait until spring when it’s local and cheaper. The prices of some cuts of beef also vary throughout the year. Good grilling meats are cheaper in the winter when fewer people grill, while good stewing meats are cheaper in the summer because who wants a heavy stew in the middle of the summer? You can save money on your grocery bills by picking up an indoor grill and using it in the winter. Then you can enjoy a freshly grilled steak and a baked potato. How’s that for a winter treat?

I try to eat fish at least twice a week, but some species are seasonal. Ask your local fishmonger to tell you what’s fresh and in season because there are some regional variations to this.

Winter Breads and Pasta
Bread and pastas are also more popular in the winter because we like crusty bread with our stews and heavier foods seem to warm us up. Fortunately, this is a place where the grocery store is your friend. When you see a sale on bread, stock up. It keeps well in the freezer as long as you slice it first so you can remove it a few slices at a time. Pasta is equally cheap in the winter. I’ve seen numerous 4 for $5 pasta sales. Pasta is easy to store and keeps a long time, so stock up on that, too.

Yes, there’s less variety of foods in winter, but you can still eat well and keep your grocery bills low by sticking to seasonal produce and meat. You might even find that seasonal food tastes better when it’s in season. If you’ve ever had a bland orange in the middle of summer, you know what I’m talking about.

I’m blessed to live in Southern California. The shiny brochures advertise it as the land of the sun, sand, and surf. That’s true – in the summer. For those of us who live here, winter is cold. Visitors from say, Iowa, may be content to walk around in shorts in January, but Southern Californians are ready to crank up the heat when the temperature dips below seventy. (I never said we were a hardy people.) Certainly, our heating costs aren’t as high those for people who live in Minnesota, but thanks to California’s screwed up energy regulations, our costs aren’t small, either.

So here are my tips for reducing winter energy costs:

Install a thermostat with a timer. My heater is set to turn on about half an hour before we get home at night and half an hour after we go to bed, then to turn on again half an hour before we get up and ten minutes after we leave (to allow for running late.) That means our heat is on for approximately seven hours a day, but not continuously. It only warms the room when it falls too far below our preferred temperature. Since my thermostat is also somewhat broken, that’s 72 degrees. I know that some experts recommend 68 degrees, but our apartment isn’t well insulated and that doesn’t get the chill out of the air.

Dress warmly and use blankets. Before you go turn the heat up any further, put on a sweater and socks. You might even consider a ski hat. That will reduce the heat loss from your body and will make you feel warmer. If you’re just sitting on the couch watching TV, use a throw blanket to keep warm. We have two chenille throws in the living room so we can cover up when it gets a little chilly. As an added bonus, the throws are also excellent ways to cover gaps in the sofa slipcover from that time the dry cleaner shrank it. Just artfully drape the blanket over the gap in the zipper and now the damage is hidden from guests.

Seal pipes, doors, and windows. If you own your home, check the pipes, doors, and windows for leaks, and then do what you must to repair them. This could mean replacing old windows with new, more energy-efficient models, re-caulking, applying duct tape, or putting a film over the windows to lock in heat. If you rent, you can at least close the drapes at night to keep the heat in. Ask your landlord if you can film the windows.

Check your furnace. You should change your air filter at least twice a year. Mark it on your calendar. You may also want to vacuum the vents. The easier it is for the air to flow through the vents, the faster your home will heat. If you have an old furnace, consider replacing it with a new energy efficient model. Although a new furnace is expensive, over time it will more than pay for itself.

Close the fireplace damper. If you’re not using your fireplace, close the damper to prevent cold air from blowing in or warm air from drifting out.

Close vents in unused rooms. If you’re not using a room, close its vent. There’s no reason to heat an empty room.

Replace lightbulbs and old appliances. Remember, that although winter heating takes up about 50% of your energy bill, your lights and appliances still impact your energy bill. By using more energy-efficient appliances and buying Energy Star appliances, you can reduce your total energy bill. By the same token, turn off the lights when you leave a room and turn off any appliances you’re not using. The printer doesn’t need to be on all the time. Unplug your cell phone or battery charger. The little things do matter.

If you follow all of the above tips, you can reduce your energy costs without feeling cold. Visit the following sources for more tips:

For everyone: SmartMoney

For homeowners: Consumer Energy Center

For renters and condo-owners: Focus on Energy

As I mentioned yesterday, I was overcharged when I visited the eye doctor in November. Fortunately, I listened carefully when the doctor explained his pricing and then double-checked the receipt when I got home. Something similar happened just last week after my husband visited the emergency room for stitches in his finger. Those two errors could have cost us $304, but I’m super-vigilant when it comes to making sure my medical bills are properly charged.

Examples of Mistakes in Medical Bills
With the eye doctor, it was a simple error on his assistant’s part. While preparing the bill, she looked up my contacts on a chart and put them down as $195. I was stunned, but I didn’t say anything because this was a new kind of contacts and my doctor had said they were expensive. My doctor matches the pricing of 1-800-Contacts, so I checked the website when I got home. It said they were $75, which is still high, but they really are that good. They’re ProClear’s if anyone’s wondering. I called the office and the assistant double-checked. She’d accidentally charged me for the toric lenses, and promptly credited my card for the error.

Just before Christmas, my husband got a bad cut and went to the emergency room for stitches. Last week we received a statement from our insurance company detailing the charges. It said our share was $284, which is odd, since our co-pay is $100 max. I reviewed the statement further and noticed that the hospital charged the wrong insurance. He’s covered by his employer and mine, but my plan is better for things like this, so we prefer to use that one. We’re not sure why they charged the other insurance because he doesn’t even carry the card with him, but we assume they looked him up in the computer and submitted the bill to the first one they found. Needless to say, he called the hospital to have the correct insurance bills and avoid paying $184 more than we actually owe. Given that they gave him the wrong kind of stitches, which left a scar, and it cost us another $100 to get them removed, it’s the least they can do.

How to Avoid Overpaying Your Medical Bills
Chances are, you’ve encountered several similar instances in your dealings with insurance, doctors, and medical bills. If you’re not careful, you could wind up paying much more than you actually owe. Here’s how you can avoid overpaying:

If a receipt is offered, take it. That way you can compare it to the insurance statements later.

Check your insurance statements. I don’t know if all insurance companies do this, but Blue Cross sends you a statement of your charges, the amount they paid, and how much you owe. If you have a receipt, compare it to the statement. If you see any charges that don’t make sense, especially tests your doctor didn’t order for you, call the insurer or your doctor’s office to get it straightened out. Also compare it to your coverage, because sometimes they do bill the wrong insurance.

Fight any improper charges. If you’ve had a long hospital stay, you’ll see all sorts of odd charges. In this case, you may want to contact a Medical Bill Advocate to make sure the hospital doesn’t sneak in any improper charges. Medical Billing Advocates of America reports this example: “It’s hard to learn how much that $12 “mucus recovery system” was really worth. We saw this on a bill once, and later learned it was a box of tissues that retails for about $2–and it’s not a billable item anyway!” And that’s the cheapest example on their site.

Keep calling until it’s resolved. With the eye doctor, it only took one call to get the contacts error corrected, but it took several calls to get my insurance coverage sorted out. I’m sure I was annoying them by calling every week to check on the progress, but in this case, it was enough to motivate them to resolve it.

Take advantage of secondary insurance. If you have coverage under more than one plan, most doctors will bill both of them. I know someone who avoided paying anything for health care because even the co-pay was covered when both her insurance plans were billed.

If you’re not careful, you could end up spending way too much on health care and health expenses. It takes just a few minutes to double check your medical bills to make sure you’re not overcharged.

Even if you have insurance, health expenses can surprise you. Last year I used my vision insurance to visit the eye doctor for new contacts and glasses. I went in accustomed to paying around $200 a year for those expenses. I left with a $900 charge on my credit card (partly due to error and party because I switched to the “Rolls Royce” of contact lenses.) I checked the receipt and got a refund for the error, then sorted out coverage with my insurer for another part, but it still cost in the range of $500. Then I went to the dentist and learned I needed a crown. Fortunately, my dental insurance covered nearly 100% of the cost rather than the 50% they said they cover, so the two expenses balanced out somewhat.

Still, if I’d planned ahead, neither expense would have been a shock to my budget. I don’t have access to a Health Savings Account (HSA) or a Flexible Savings Account (FSA), but that doesn’t mean I can’t plan ahead for medical and health expenses. If you do have access to either of those accounts, then you have several options when it comes to saving for health expenses.

Health Savings Account
The HSA is relatively new. It was introduced in 2004, and some employers offer them along with high deductible health plans. The idea is that you use the HSA to pay for qualified health expenses until the deductible is spent, at which point insurance kicks in. In 2008, you can contribute up to $2800 for a single person and $5900 for a family. Contributions come from pre-tax dollars, which reduces your tax base, and employers can also contribute. The downside is that you can’t withdraw the money for non-medical expenses without paying taxes and a 10% penalty (unless you’re over 65, in which case you only pay taxes.)

Most medical expenses qualify, but not all. You can use the funds to cover:

  • Co-pays
  • Deductibles
  • Prescriptions
  • Over-the-counter medications for defined conditions (like allergies)
  • Glasses
  • Hearing aids
  • Dental expenses
  • Vision expenses
  • Transportation related to medical care

You don’t have to pay the funds directly to someone, but can use it to reimburse yourself for the expenses. You do have to keep receipts to document the expenses, though. You can use the funds to pay expenses even for spouses and dependents who aren’t covered by your high-deductible health plan, but you can’t use it to pay their premiums.

The nice thing about the savings account is that you don’t lose it if you don’t use it. You can roll it over when you change jobs. If you die, it transfers to a beneficiary with no limits on how he or she can spend it.

Flexible Spending Accounts
Many employers offer FSAs. These are also funded with pre-tax dollars, up to a cap of $5000, and are used for similar expenses as the HSA. The trick is that you do lose the funds if you don’t use them by the end of the plan year. Also, if you change jobs, you can only use it for expenses incurred while you were covered by the plan. On the other hand, all funds are available on day one of the plan year, even if you contribute to it with funds from each paycheck. If you plan to switch jobs, get your expensive medical treatments before you leave the plan so you can spend down the money.

Personal Savings Account
If you’re like me and don’t have one of those plans available, you can create your own account to cover health expenses. It won’t reduce your tax base or use pre-tax dollars, but it will collect interest if placed in a high-interest-rate savings account. Simply visit a bank, or online bank, that offers no-fee savings accounts and set up direct transfers from your checking account every month. Then when you have health expenses, reimburse yourself from the savings account. If you don’t spend it, you’ll still have the savings.

This is especially helpful for people with individual health insurance instead of an employer-provided plan. Rather than spending an extra $200 a month to reduce your deductible by $1500, put that $200 a month into the savings account. Then if you need it, you can pay towards your deductible, if you don’t, you still have the money.

Determining How Much to Contribute
Before you contribute to any account, figure out how much you usually spend on health expenses. Get out your receipts for last year and total up how much you spent on co-pays, deductibles, emergency room visits, lab fees, dental costs, eye exams, glasses, the chiropractor, prescriptions, and over-the-counter treatments for colds, allergies, and other defined conditions. That’s approximately how much you should contribute to your savings account or spending account. You may want to add a small cushion, especially if you have young children. Add more if you’re pregnant or have an ongoing condition that may require additional treatment.

Regardless of which plan you choose, it’s a good way to cover health expenses without going into debt or running up credit card interest for unexpected costs.

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