As a young girl, I was often called on to help my mom figure out where she had gone wrong in her checkbook register. Most often I discovered she would round off her entries…and she would round down. So a $10.04 check became $10 in her checkbook. Over the course of a month, this can throw your balance way off. And even if you only do it once, you simply cannot balance your statement. Though she never bounced a check, her monthly statement balancing was always a time killing chore.
This experience developed in me the joy of rounding up. In the same way that I prefer to arrive early as opposed to on-time, I prefer to round up always creating a little padding.
For the past 11 years, I have managed my own Insurance Savings Account. This account serves to save monthly for semi-annual and annual insurance expenses. To figure out what I need to save each month, I add up the policy expenses:
Life Ins #1 Annual
Life Ins #2 Annual
Personal Articles Floater Annual
Then I take the annual total of those policies and divide by eleven (11)…not by (twelve) 12. Dividing by 11 gives me that extra padding I like.
Unfortunately, I have a really horrible confession to make. Since I do not manage our mortgage escrow account, I failed to take note of the homeowners policy renewal that went into effect in August of 2009. It contained a substantial increase from the previous year.
When I received the escrow shortage notice at the beginning of February and I almost cried. As I looked over the changes, I noticed a $500+ increase in our homeowners policy. How did I miss this?
Without boring you with all of the details, I was able to get a policy adjustment, a credit, and have the mortgage company give me a escrow buy down amount so that my payment will remain where it is. After the adjustment and credit, I still needed to pay almost $600 for the escrow buy down to keep my payment for changing. $600 that I hadn’t planned for. Where should I pull that money from?
My thoughts went to the Insurance Savings Account. Knowing there had to be a little extra money in there, I ran the numbers through a simple excel calculation (simple is about all I know how to do with excel). I was prepared to pay extra into the account with my monthly deposit to make up any difference or deficit.
As it turns out, the Insurance Savings Account has more than enough padding to cover the needed escrow shortage funds. That’s my benefit for consistently putting more in (by rounding up) than I have been taking out.
And this is yet another thing for which I can offer my
Endless Praise to God…for creating me with all my ‘quirks’ and ‘methods’, for my obsession with little numbers and for providing when circumstances like this arise.