Many people pay their bills on a monthly basis. However, some service providers and insurance companies offer bill payers the chance to make up-front payments.
If you have a car insurance policy, you can save money by paying on an annual basis.
As you make an annual payment, check the price on your policy. If you haven’t shopped around for the best rates on since you first bought your car, it might be time to start comparing rates and switching to a cheaper insurance plan.
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Homeowners must pay property taxes. While some lenders roll property tax payments in with a mortgage, meaning homeowners pay for property taxes monthly as part of their mortgage payment, it’s also possible to make these payments on a yearly basis.
Paying property taxes on an annual basis can help save a bit more money than making the payments on a monthly basis, as some municipalities may charge a small fee for each monthly payment.
Remember that property taxes are calculated a little differently depending on the city and state you live in. Check in with your local county treasurer and tax collector’s office to see whether it’s possible to make payments in installments or one lump sum each year.
If you attend a private school or are sending children to a private school, you may consider paying tuition on a yearly basis instead of monthly.
Alissa Krasner Maizes — JD, financial planner and founder of Amplify My Wealth — said private schools often charge significantly more money when you pay monthly. However, the contractual obligations are the same and often nonrefundable to everyone regardless of the payment plan.
Krasner Maizes said extra charges often include expenses incurred by employing an outside company that processes the payments and credit card fees.
“I always pay my homeowners premium annually to avoid unnecessary expenses that I would otherwise pay by making the monthly payment option,” Krasner Maizes said. “The coverage is the same, and my insurance company will refund me the unused portion of my premium if I opt to cancel the policy before year end.”
You can pay for a gym membership in monthly installments or pay it annually — and the general recommendation is to pay for it annually.
Some gyms may offer discounts to members who commit to paying for the entire year up front. If you’re a regular at your gym, this discount can help you save a great deal of money and ensure you never have to worry about missing a payment.
Most subscribers to streaming services, like Hulu and Amazon Prime, pay for their subscription services on a monthly basis. However, both platforms offer subscribers the ability to pay on an annual basis.
Carter Seuthe, CEO of Credit Summit, uses the example of subscribing to Amazon Prime. Monthly subscribers currently pay $14.99 while the annual fee is $139 — a savings of about $40.
If you have a life insurance policy, consider paying the premium on an annual basis. Many insurance companies may be willing to offer discounted premiums for yearly payments. Compared to making monthly payments using automatic billing, this can lead to significant savings.
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