Do you feel the pinch? Tips to reduce your expenses | The young witness
Story in partnership with Savvy.
With the current high CPI and the cost of living continuing to climb, it’s no surprise that many Australians are under financial pressure.
Even if you have a paid job, the need to increase your income a little is felt in households across the country.
With rising bills, it can be tempting to resort to spending more and more on already overloaded credit cards or using potentially risky “buy now, pay later” accounts. These can easily create a spiral of debt and lead people into even worse financial situation.
But there are some simple steps you can take now to control costs, overcome debt and ease the pressure, says financial expert Bill Tsouvalas, founder of Savvy.
“Financial stress is widespread,” he said. “But beyond increasing your income, there are simple actions you can take immediately to help you better control your expenses.”
Set yourself a budget
When life gets hectic, there is often little time left to sit down and focus on where the money is going. Several tools are at your disposal to help you easily track your entries and exits so you have an accurate picture of your situation. It’s easy to take the ostrich approach, but knowing exactly what you’re up against is the first step to smart money management.
If you have outstanding debts, one thing you can do is consider a debt consolidation loan. Multiple debts can be difficult to manage individually. A consolidation loan allows you to pay off multiple debts and then focus on servicing one loan, with a cheaper rate and flexible repayment options.
“People may have lots of different loans, or a credit card that they can’t fully pay off each month, like a revolving door,” Mr. Tsouvalas said.
“A debt consolidation loan lets you draw a line under it with a single loan with more competitive interest rates and fewer fees so you can save money and better manage what you owe.”
Review your mortgage
Home loan interest rates are at historic lows, but are expected to rise in the future, so any decision to lower your current rate and move forward on your payments now will help you be better prepared.
Review your current mortgage arrangement and talk to your lender about getting a better deal on your rate.
Or you could consider refinancing. Savvy lets you quickly and easily compare some of the best deals available and find the lowest interest rate and most suitable loan for you.
Take stock of your insurance
Insurance – car, home, health – are among those expenses that we pay reluctantly but whose importance we understand. It’s comforting to know that if the worst happens, we are protected.
But often the renewal date slips by so quickly that we don’t have time to carefully review the policy we have and make sure we’re not paying more than necessary.
Health insurance is an example. If you haven’t looked at the details for a while, you may find that you’re paying for benefits that you don’t need at the stage of your life.
High electricity bills have been a big concern for many households over the past few years, but there is good news.
Recent data showed that the price of electricity is the cheapest in a decade. Unfortunately, many people do not take advantage of the available opportunities and always pay more than necessary.
In progress analysis of the Society of Saint Vincent de Paul revealed that the majority of customers did not benefit from the most competitive offers on the market.
With an increasing number of providers these days, it’s worth exploring your options to see how much you could save.
An easy way to save on bills is to use the free government-run website Simplified energy.
To learn more about how to take advantage of a debt consolidation loan or lock in a more competitive home loan, visit savvy.com.au
Story in partnership with Savvy.