Rises in the cost of living may be causing you to worry and panic about your financial situation.
It’s understandable to be worried, but there are ways you might be able to improve your circumstances.
In this blog, we will cover a few strategies you could try to help with tackling rising living costs...
1. Focus on reducing monthly bills
The most effective thing you can do to tackle rising living costs is to try and reduce your monthly spending. Focusing on this could help you to cover the extra living costs and so it may help to relieve some of your worries.
A couple of ways you may be able to help cut your costs might include:
- Shopping around for better mobile and broadband deals – Suppliers can often cut their prices to encourage people to switch accounts. Therefore, it’s worth shopping around and seeing whether you can get a better deal elsewhere.
- Reduce water consumption – Try to limit the number of baths you take and make sure you do any washing up in a bowl rather than under a running tap. In addition, you could install a water meter to monitor how much you are using.
- Transport costs – Travelling to and from work can add a lot to your monthly expenses, so it is worth thinking about ways you could reduce this. If it’s a possibility you might want to consider walking or cycling to work to cut fuel costs. Additionally, whenever you have to travel further afield, it’s worth ensuring that you book your travel in advance to get cheaper prices.
- Pay bills on time – Another important thing to consider is when you are paying your bills. If you’re often late at making payments, then you may be charged interest or face extra fees. Therefore, it is worth trying to make your payments on time to ensure this does not happen.
2. Consider consolidating debts
Debt consolidation is a way of combining all your debts into one single loan, which means you’ll only have one monthly repayment to make, rather than multiple. This may be achieved through a debt consolidation loan.
Doing this can make keeping on top of your repayments easier. It can even reduce your monthly outgoings, as you may get a lower interest rate or be able to spread the debt repayments over a longer term. However, spreading debts over a longer term could result in you paying back more in interest in the long run.
A range of methods can be used to consolidate debts. Some of these include:
- Borrowing more from a first mortgage provider. Although many first mortgage providers may have restrictions on lending for this purpose.
- Getting a personal loan, however, the loan terms available are typically only 5-10 years. This may not provide the needed reduction in outgoings.
- Another popular option is to take out a secured loan. With these loans, you can borrow a large sum of money (over a long or short term) to cover a range of purposes. These loans are secured against a property you own, which means that your home may be repossessed if you do not keep up repayments. As a result of this, lenders are usually more flexible with their criteria. So, you have a greater chance of getting accepted and may qualify for lower interest rates.
To get one of these options, it may be beneficial to speak with a mortgage broker who can help you understand what may be most suitable.
3. Think about selling items online
We’ve all been in that situation where we hold on to items that we no longer use, whether it's clothes, toys or electrical devices.
Although it can be nice to hold on to these items, it can also be a useful source of extra income.
There are lots of places online where you can sell your old items, it’s just a case of researching which one is the best fit for you. Once you have determined which sites to use you can start listing the items you want to sell and make some money.
It may not be a huge boost to your income, but it can help to give you a bit extra to work with.
We have a much more detailed blog available on how to cut your everyday bills, which shows you some other tactics you could employ.
Conclusion
In summary, the rising cost of living is scary for many people, but some methods can be used to help relieve this pressure. This may include reducing monthly spending, consolidating debts and selling old items online.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
