When I think about bills, I annualize them. $30 a month? That’s $360 a year. $5/mo? $60 a year.
I use this to help me grasp the long term cost of all my decisions, but nobody else I know does this.
For instance, my brother and I are moving soon into 2 separate apartments (we currently share a 2 bedroom) and the new complex doesn’t have Google Fiber Internet. I complained to my brother that on top of everything else I’ll have to pay $5/mo extra for Google extended storage I was getting for free.
He said it’s only $5/mo, just get and don’t worry about it. I was like, that’s $60 a year which is basically a Costco membership. He said “oh hmm, good point yeah”
So I’ll work on reducing my storage usage on Google to be able to stay on the free tier, but am I alone in thinking this way about everything I buy?
It’s also cool to do this with savings pots. When people have a hard time saving, they’ll say things like “what’s the point in saving £10 a month towards X, that’s nothing”. I usually point out the annual figure, since a lot of people don’t think that way.
That said, personally I do this too much, and it can make it hard to spend and too enticing to save. But that’s a different topic…