Why To Check Your Bills (Or: Why Not To Check Your Bills)
A woman in Connecticut checked her old electricty bills in preparation for the sale of her house and found that she had been overcharged $35 each month for the past 25 years! After only a little bit of a fight, the power company reimbursed her $10,500. Amazing! Wonderful! We should all check our bills? EXCEPT: We should all not check our bills.
If this woman had checked her bills and discovered the error ten years ago, she would have had an extra $35 per month, yes. But because she didn’t check her bill, however, she ACCIDENTALLY, THROUGH NO FORESIGHT OF HER OWN has an extra $10,500 now! Which is better?!!? If you’d asked her 25 years ago, she would have said: $35 now (duh). BUT OBVIOUSLY if you ask her now, she would say: $10,500 now (duhhhhhhhhh).
“But if she’d just checked her bill, she could have put still saved $35 each month and put it in a high-yield savings account and earned interest on her—” No. That would not have happened. She would not do that. No one would do that (Mike Dang might do that). She would have given herself permission to go a little crazier at the grocery store and buy the name brand cereal. Maybe she would have signed up for premium cable. Most likely she wouldn’t have noticed that extra $35 at all.
So: Don’t check your bills. Or, mostly don’t check your bills. Of course, in order for this to work as a savings plan you have to check your bill at some point to see if you’ve accidentally saved ten grand. Let’s trust our guts on when that should be. Deal.
This is how I feel about taxes. Take as much as you want now; I won’t even notice. Just give it all back to me next April so I can pay down my credit card. Thanks Government!
@Heather Sundell@twitter Exactly! I’m happy to give the government a “free loan” because it’s like a savings account that just doesn’t accrue interest.
I had the saaaaame thought process about how amazing this is because would I ever save $35 a month? No. Would I love a magical windfall of $10,500 25 years from now? YES!
@Kate I always thought I would never save however-much-per-month but between ImpulseSave and just direct depositing a portion of my paycheck straight to savings I am slowly becoming a saver. Like I just paid off the $593 balance on one of my credit cards b/c I had been saving with ImpulseSave. So yeah, it’s not gonna get me a $10,500 windfall BUT if you are interested in ever trying save, it can be done, I am living proof!
When my grandfather passed away, we discovered that my grandparents were paying $8/month for about 45 years to RENT their TELEPHONE from the phone company. Phones cost, what? $15? We put an end to that.
Of course the $10,500 seems nice now but what if she didn’t win her case? She would be out that money. I don’t trust companies to give me back what they owe me so they only get what I owe them. And on the tax issue I’d rather keep my money and not loan it to the gov’t for free because what do you learn from that? It’s better in the long run if you teach yourself how to save instead having someone else force it on you.
Except ‘don’t check your bills’ is a bad idea because what if the exact opposite happens?! I have definitely known that to happen to people, they’re about to move out and SURPRISE they owe $500 because they were undercharged.
Wouldn’t they owe her (compound) interest as well? $35 x 12 x 25 = $10,500 so it doesn’t seem to include interest at all…