Bills, Bills, Bills: How To Bring Down Your Monthly Household Outgoings
The last few months have been transformative in this country and in the wider world – not in a positive sense, it has to be said, but in a way which has led to us discovering a few things. These may be details about ourselves, such as a not-previously-noted skill for baking. They may be things we’ve noticed about the world and how the people around us deal with a crisis. They may also be surprise side-effects of spending increased time at home.
All sorts of stories have emerged, of how people have been surprised by just how much time their cat spends asleep or how quarantine has generated a different type of dream. More prosaic details have come to light as well; for example, the entirely logical – but nonetheless unexpected – increase that has been noticed in household utilities spending.
Think about it: if you usually work in an office, your computer is powered off the office supply. If you have something to eat, it will usually have been cooked in the office kitchen. You’ll then wash your hands using the water supply at the office. There is nothing like a spell in lockdown to make us all think a bit more about what we need to use, and when. Being smarter about this could save you a lot of money in the long run.
Keeping on top of your bills
Not all bills relate to household utilities; essentially, if you want to spend less each month, you’ll need to consider what fixed outgoings you have, costs that must be met on a monthly basis. Of course electricity and water fall under this banner. In most UK homes, so too will gas. Then there are secondary bills which, while not necessarily essential, can take up a lot of your monthly budget. Telephone costs (mobile and possibly landline), subscription TV services, internet service provider… even if you have combined these with one supplier, they can still add up.
There are further costs still, for many people. If you have insurance – and anyone with a car on the road must have at least that form of cover – then you could well be looking at a significant monthly output in terms of spending on things that are just there. Think for a moment about how much cash you might be devoting to just having the necessities. It’s always useful if you can make a hole in that kind of spending.
Where should you look to make cuts?
In an ideal world, we would all be able to look at our outgoing costs and see where we can cut out big chunks of spending, but that isn’t always the case. However, if you don’t often run the rule over your household budget, you may have some outgoings that you’ve never really considered. Sit down, open your online banking accounts, and calculate where money is going on a monthly basis. Then ask yourself if there are better ways it could be spent. Do you need, for example, three online streaming services? Are you still paying insurance for gadgets you no longer own?
Naturally, you can’t stop paying for electricity or water; not without some pretty substantial difficulties arising. But you could still ask yourself whether there are different tariffs you could switch to; it may be that you signed up for these services when the world was a very different place. Changing now may see you save money. Indeed, some car insurance companies paid their customers a rebate after the lockdown led to fewer cars on the road and fewer accidents as a result. If you haven’t had something similar, speak to your insurers and see if anything could be arranged.
Making a more definitive change
Sometimes to get more value for your monthly outgoings, it will be necessary to consider making changes in the home. One example of this would be a veg garden, which allows you to plant your own food rather than spending more in the supermarket. A less work-intensive approach could see you checking out boilers on finance to find a way of spending less money on things like central heating and hot water. It’s a particularly wise time to look at making changes like this – the average boiler has about fifteen good years, so most of us could do with a new one; and if you do it now, you’ll have the benefit in winter when you really need it. We’re also on target for one of the wetter summers of recent times, so working on the garden is a smart move.
The crisis and the lockdown have seen a number of providers – from utilities companies, to insurance brokers and even HMRC – offer payment holidays to homeowners and renters. Before deciding to accept these options, though, it’s worth taking a moment to consider whether they would really benefit you. If you have the money to make your payments, it’s best to make them now, rather than gamble that you won’t have any major outlays to make in the next six months, when these payments would be likely to fall due.
What does make more sense than accepting a payment holiday you might not need, is asking providers whether there are any tariffs that would make more sense for you in light of the changed realities we’re all dealing with. If you chose your internet plan based on the fact that you were only using it lightly, and only in mornings and evenings, this will naturally have changed if you are working from home. Additionally, if you have been paying insurance premiums for a while and never made a claim, it is worth speaking to the providers to see what you might qualify for in terms of a no-claims bonus. This may afford you a genuine lump sum of cash, or a reduction in monthly payments.
Take advantage of low-hanging fruit
Many of us miss regular opportunities to save money simply because we don’t know those opportunities are there. Regular payments to credit cards are an essential part of credit management, but every once in a while you should take advantage of the opportunity to shift your balance(s) over onto an entirely new card, which will offer a 0% interest rate on balance transfers. Using credit, and doing it smartly, can save you a great deal of money in the long run and will also boost your credit rating – so if you end up needing to borrow for something important, you’ll have the power to do so.
Check out every special offer you get in your email, through the door and in any other way. Sometimes – perhaps even in the majority of cases – they’ll be little more than spam, but every once in a while you’ll benefit from an excellent deal that saves you cash and allows you a level of spending power that really aids you going forward.
Digging deep into your monthly outgoings and finding ways to cut what you are spending on them might take some effort right now, but the benefits you can count on from taking this action will last for much longer and will allow you to open up new opportunities. Go through your monthly budget and note down where savings can be made, then go about securing those savings and you might just be surprised by how much you can cut from the budget. This can then be reinvested in savings accounts and other products which will allow you to have increased financial freedom in the future.