Oatmeal epitomizes virtue. One serving each morning helps lower total cholesterol, including the nasty LDL cholesterol that can clog arteries. As Wilford Brimley once said “it’s the right thing to do.” But Brimley ignored a major downside: oatmeal not only sticks to your ribs, it sticks to your teeth. A toothpick can’t get rid of all the gooey stuff. And a toothbrush doesn’t remove everything either. Only dental floss can banish the gunk that sinks in between the molars. So whenever I eat oatmeal (usually Coach’s Oats®), it’s a foregone conclusion that I’m also going to floss. This is all to the good, because daily flossing fights tooth decay, hinders gum disease, and may even help prevent the arterial plaque that causes strokes and heart attacks.
When you think about it, the linkage between oatmeal and floss is striking. You perform one virtuous act—the eating of a hearty breakfast—and you’re inexorably propelled into another virtuous act—the flossing of your teeth. These two healthy choices pamper your arteries with a double dose of vascular goodness. It all reminds me of the buy one get one free (BOGO) bargains at the supermarket.
So in today’s post, let’s look at deals that double the benefits to your fiscal health. How many of these BOGOs do you practice?
DIY Tax Planning —> DIY Tax Preparation
Do it yourself tax planning delivers big benefits. You learn firsthand how to finesse gross income, extract more deductions, and exploit available credits that reduce your tax bill on a dollar-for-dollar basis. You also learn how to time the receipt of income and expenses. Sometimes, it helps to defer year-end income until the following January. Other times, it helps to pay some of next year’s expenses before December 31. Once you’ve mapped out your tax plan for the year, you’ve basically finished most of what it takes to file a return. So instead of paying someone else to do your taxes, you can easily complete the forms yourself. It’s a clear case of BOGO. The virtuous act of planning your taxes ahead of time helps you to bypass pricey accountants.
Health Insurance —> Health Savings Accounts (HSAs)
Not only is health insurance a legal requirement, it’s a financial necessity. Nothing can wipe out your nest egg quicker than a severe medical condition. When you buy a high-deductible policy, another good thing happens: you typically qualify for an HSA. HSAs are great because they provide three levels of tax benefits: (1) whenever you make a deposit, you get a deduction (even if you don’t itemize); (2) earnings grow completely free of taxes; and (3) when you withdraw money, you don’t incur taxes as long as you’re paying for qualified medical expenses. And so it’s BOGO all over again. One virtuous act—the purchase of health insurance—directs you towards another—the funding of a triple-tax proof HSA.
Automated Budgeting Sites —> Credit Card Rewards
Automated budgeting sites such as Mint let you link various accounts—credit cards, checking, debit cards—into a single location at which you can track all your spending. With pie charts and graphs, these sites make it easy to see exactly where your money goes. Every time you use plastic to pay, the website automatically reports the merchant involved and assigns the expense to a specific category. But whenever you use cash or a check, the website can’t tell who you paid or where to allocate the expense. So you have to enter those details yourself. One way to avoid this hassle is to use your plastic more often. When you do this, your card rewards increase. So once again, a virtuous practice—the use of an automated budgeting site—leads you to another—the increased use of reward cards (never use credit cards unless you pay them off in full each month).
Sales Tax Holidays —> Planning Annual Purchases
Many states suspend sales taxes for designated items on certain days of the year. A nationwide list of these tax holidays appears here. If you delay your purchases to take advantage of an upcoming holiday, you’ve taken a first step to timing the market for other purchases. After all, once you plan ahead to save a few bucks in sales taxes, you begin to see the benefits of waiting for future sales, model updates, and end-of-season closeouts—events which all deliver much greater savings.
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Inevitably in life, one thing leads to another. And life goes so much smoother when you link together beneficial positives instead of detrimental negatives. Consider adopting the above BOGOs as part of your own financial routines. And if you know of any other great BOGOs that I’ve overlooked, please leave a comment below.