5 tips to cutting costs


We are a couple of months into this period of restricted freedom and entertainment choices, and many of our incomes are under strain. Our jobs are disappearing and incomes are being reduced or eliminated altogether. We cannot control the income picture easily but we can look at the costs. This week I conducted an audit of my finances, this included listing the items I am currently paying for and asking myself when was the last time I changed a supplier, am I receiving the same benefits for the goods or services I use?



Below are 5 tips to reduce those bills




Cancel or pause subscriptions. Photo by Aravind Kumaron Unsplash

I quickly looked through my bank and credit card transactions from over the last few months and picked out the regular payments I was making. I was surprised that I was still making payments for magazines I no longer read and was even paying for a mobile phone bill for an ex; the device wasn’t even being used!!


I suggest focusing on what you consider to be essential items, for me, these include mobile phone and streaming services.



Switch to own brands

For me, this kind of happened by force as my local supermarket struggled to secure branded products I usually purchased. But as the supply chain for foods and household items improved, I found the own store brands tasted or worked as well as the branded stuff but were 5%-15% cheaper.

According to research by the Good Housekeeping Institute, switching just seven branded products you buy regularly to non-branded equivalents could slash around £240 a year off your shopping bills.





Photo by Mick Haupt on Unsplash


Remortgage

My mortgage is my biggest monthly outgoing, and despite the recent falls in interest rates I was still paying 4.9% on a standard variable rate. I checked a couple of websites and found that there were a number of deals where the rates were substantially lower. I was angry with my mortgage provider for not contacting me, but why should they? The point is, I didn’t pay attention to when the deal expired and my fixed-rate mortgage changed to a standard variable rate and as a result, I paid over £100 per month extra. My ignorance or laziness cost me, dear.


Photo by Travis Essinger on Unsplash


I suggest checking the rate you’re currently paying and see if you might be able to reduce your monthly payments by remortgaging. If you’re on your lender’s standard variable rate, you’ll almost certainly be able to cut costs, and savings can be substantial. My remortgage deal comes without an arrangement fee, but many do, so ensure you factor these costs in when calculating how much you’ll save.


Before speaking with my lender, I wasn’t sure whether I’d be able to remortgage, as my source of income had been variable and I feared they’d think I’d struggle with payments, so I considered asking for a mortgage holiday, which you can get in the UK for up to three months. This at least in the short term would help relieve some of the financial pressure. I even considered moving to an interest-only mortgage. This would have cut my monthly payments costs considerably until I got my finances stable again. As this cost is usually the largest, I’d suggest speaking with your lender about your options. Don’t bury your head as I did, not only are you potentially saving yourself a lot of money, you could be relieving stress.

Reduce and/or consolidate phone and Internet services


Photo by Giorgio Trovato on Unsplash

The 3 main services I use are phone (mobile), TV (cable) and internet (broadband). I have separate providers of each. I took time (a lot of time) to work out the best deal for each and where possible as a bundled package. I found costs varied quite a lot depending on the service I required and I must admit it was a little confusing doing it altogether. That said, after simply looking at the services individually I asked myself what do I really need as far as data capacity, TV channels and network coverage, then shopped around for the best value for money deal. I even considered getting rid of the cable TV altogether and instead use free to air channels on my TV. This would have saved me over £700 per year, but I love some channels too much to give them up. I will also consider subscribing to specific online providers such as Netflix, Hulu, Disney plus, Amazon prime tv, but for now, consider my £20 per month saving very good. By the way, when was the last time you used your landline phone? I got rid of mine a few years ago and haven't missed it. I think it's worth considering the value of having both when one would do.

Grow your own food

My dad had an allotment, and for years the family munched on potatoes, tomatoes, leeks, cucumbers, carrots, and an assortment of herbs. As an adult I didn’t have time or the inclination to grow anything, but as I looked out to my garden the other day, I thought it would be nice to put something into the soil. It’s a bit late in the year now to grow anything, but come the autumn the conditions will be perfect for growing my own veg, herbs and fruits. The start-up costs were basically just garden soil, a few tools and seeds for the basics like carrots, peppers, tomatoes, and squash. I’m not suggesting you buy a tractor and become a farmer, however, there are a wealth of Do-It-Yourself information available for free on the internet such as Garden Building Direct, that will point you in the right direction. Not only will you have the satisfaction that comes with producing much of what you eat, according to Moneywise you’ll save a good deal of money too.


Author: Chris E



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