Tips For Spending Less - How To Reduce What You Spend

Top Practical Tips For Spending Less

Tips For Spending Less - Remortgage

Because mortgages are for such huge amounts of money, even a small change in the interest rate can represent a huge saving to you, particularly in the long term. This is far too big a subject to get into much detail here, but if you have a substantial mortgage, which does not have horrendous penalty charges for moving lenders, you really should take some time to look into this as it could save you many thousands of pounds.

Remortgaging is just moving your mortgage from your existing lender to another one. First things first - you don't want unnecessary hassle if you can avoid it, so ask your existing lender for a better deal first. Sometimes they are happy to improve your deal rather than lose your custom.

When you are comparing deals, you will need to take into account more than just the difference in interest rates. If the deal with your current lender includes penalty charges for leaving them, then you need to factor that in, as you will with any set up fees for the new mortgage, and the inevitable legal fees involved. This is why is it sometimes not worth remortgaging if your remaining mortgage is relatively small - the benefits to be had might not outweigh the costs of moving.

If you have other debts and loans, you may want to consider paying them off through your new mortgage, as the rate of interest will almost certainly be much better, especially if your other debts are with credit cards.

Don't Save - Pay Off Debts Before Saving (see separate page)

Energy Suppliers

This is a constantly shifting scene, but there are significant differences in costs, and the cheapest supplier one day could be one of the most expensive a couple of months later. Thanks to various online comparison sites it is relatively easy these days to both compare suppliers and move your account. You can even get cash back and other incentives for switching, depending what services are offering when you compare. Two of the most popular comparison sites are energyhelpline and moneysupermarket

It is usually cheapest to set up a direct debit for your monthly payments. Whether you do this or not, always read your own meters when you receive bills, to see how far out the estimates are. Meters seem to be read only rarely these days, and the estimates can be wildly wrong. You don't want to be hit with a massive bill when they finally read your meter and find they have been undercharging you for the last year. If you find the estimates are too low, give them the correct readings and pay the difference so you don't fall behind.

Council Tax

Council tax is a very substantial expense. The amount you pay depends on which 'band' your home has been put into. The initial classification was done in a great hurry in the early 90s, and many houses have been found to have been wrongly classified. It is worth checking your banding and challenging it if you think it is wrong. It is not at all unusual for a council tax band to be changed, and if you have been in the property for some time, this could mean a refund backdated to when the tax was introduced in 1993!

Check your banding, compared to your neighbours and other similar properties, and if in doubt contact your council to appeal against the band you are in.

Using Credit Cards

Using credit cards is a huge area in itself, which I hope to cover in a separate section of this site soon. I just mention them here in a particular context, assuming you have some credit card debt and can't afford to pay it all off at once.

Avoid just paying the minimum payment on credit cards - pay off as much as you can each month. Ideally, set up a direct debit to clear the balance every month. If you are not able to do that, then at least pay a fixed amount each month based on the maximum you can afford. Direct Debits are great because they make sure you don't get penalised with fines by forgetting to make a payment. Credit card companies make their money by keeping you owing money, so you must pay them off quickly. The longer you take to pay them off, the more it costs you.

Shopping For Food

Try dropping some branded items in exchange for the supermarkets own brand or economy brand. Research shows that dropping a level (from branded to supermarket, or from supermarket to economy) can save you a third on your shopping. The difference in the product will vary from none at all to something more noticeable, but you need to be open minded about it - sometimes the difference can be all in your mind! You don't have to go from rock bottom economy brands on every aspect of your shopping, but experiment and find out what you can change without making any difference to your experience. Given the price difference it can make, it is well worth a try as the savings over the course of a year are substantial.

Insurances

Once again the job of comparing and finding the best value insurances is made considerably easier through the various comparison websites now available. A key thing to remember is that you don't have to wait until your policy is up for renewal to swap providers. You can cancel at any time and should get a refund on the remaining term of your policy. If you are paying over the odds, every day you wait is money wasted - do it now. This applies to car insurance, life insurance, home insurance, etc.

With house contents and building insurances there are various risk factors which you have influence over that can have a significant effect on the premium cost. These include fitting window locks, burglar alarm and choosing a higher excess.

If you bought mortgage payment protection insurance or life insurance through your mortgage company, you are almost certainly paying way over the odds. Compare other providers and replace your overpriced policy with a better value one.

When buying products in shops you will often be offered insurance or extended warranty cover for the product. Don't take it! This is an extremely profitable sideline for shops, so it is no wonder they push it hard. You don't need insurance for something that is new - if it faulty you take it back and they have to replace it or give you a refund. The 'Sale and Supply of Goods to Consumers Regulations 2002' says that any fault arising within six months of your purchase are taken to have existed when you bought it. It is up to the seller to prove otherwise.

Tips For Spending Less - Conclusions

Follow the above tips for spending less and you can make a significant difference to your outgoings with relatively little work. It is worth reviewing these key elements of your spending on a regular basis, to make sure you are not spending any more that you need to.

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Tips For Spending Less:

Practical Advice To Reduce Your Spending

Top Practical Tips For Spending Less

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