If you’re anything like me, you have more outgoings than you really need. There are little things that you wouldn’t usually consider as expensive but when added up they soon affect your disposable income.
Over recent months I’ve considerably cut down the household outgoings. My husband and I are trying to save more, so we applied these five tips to reduce our outgoings and make sure we had more disposable income.
Taking out a loan to pay off another loan isn’t something I would usually recommend, but this is something we did. We took out a loan to cover all our individual ones. It meant a lower interest rate on the total amount, a lower monthly payment and one single payment to make.
Before, we were spending hundreds of pounds on separate loans, from credit cards to overdrafts. We had no idea when we would be able to clear them making minimum payments.
With the consolidation loan, we now have an end date and have been able to reduce our monthly payment by more than £200. On top of that, I’ve been able to reduce the maximum allowance on the biggest credit card because to reduce the chance of spending on it.
Since the consolidation loan, we only have one credit card that we use each month and then pay off the balance at the end of each month. This is expenditure we would usually spend through the debit account but want to make sure my husband has a credit history since the consolidation loan is in my name only.
Monthly outgoings saved: £200
Cut Out Unnecessary Direct Debits
I’ve managed to stop five direct debits that would usually go out without me thinking. They were all cover on various appliances, including the tablets and laptops.
I wouldn’t usually scrap cover unless I had it somewhere else, but we’re making big changes and will be getting rid of some of the appliances soon. If they break then it’s no big deal. With another, if it breaks we’d replace it anyway with a newer version rather than getting it fixed because it is so out of date.
My husband also cancelled his gym membership because he just doesn’t have time to use it anymore.
Look at your direct debits and decide whether you are actually using them and need them. You may have magazine subscriptions for ones you don’t like anymore, for example. Cut out all the ones that you don’t need.
Monthly outgoings saved: £55.50
Reduce Direct Debits
There are some direct debits that we couldn’t just remove but we have been able to reduce. The energy bills were one of the big savings we made.
I tend to overpay the gas and electric each month. It’s set so that in the winter I can use the build-up I create by overpaying in the summer months. The problem is the direct debit is always that high that even in the winter months, the bills are less than the amount we pay. We now have a big balance within our energy account.
We do get paid interest for being in credit, but it’s time to reduce some of it. That meant reducing the direct debit. I had to actually reduce it more than what I really wanted to because we have such a credit!
It’s worth looking at your monthly direct debits to see if there are any that you can cut down on. Maybe your internet bills are larger than necessary or you can switch your gym from peak to off-peak to save some money.
I used to be loyal to a big branded supermarket over here. I have a rewards point and it used to be worth it to shop and get petrol there.
That’s changed now. The reward structure changed and it’s harder to get the free vouchers with the points, so we’ve chosen to look around at other places to do our grocery shopping. What used to cost us £70-£80 for a weekly shop now costs us £40-£50 because we’ve gone elsewhere.
You could even look around at getting different parts of your shopping from different places. Try the butchers for your meat or the grocers for your fresh vegetables. For us, it’s not worth the potential savings to do that. It’s better for our family life and the drive to do all our shopping in the one shop.
Monthly outgoings saved: about £120
Start Walking More
Our travel outgoings were another big expenditure that we didn’t really need. There’d be times that I’d pick my husband up from work to get him home earlier, without a real reason for needing him home earlier. There were other times that I’d drive my daughter to nursery when I could have quite easily walked.
We’re looking at selling our car soon (for other reasons than saving money) so it’s time for us to start walking. The nicer weather is coming in, too, so there’s not really much excuse. I did originally have the excuse of no pushchair for the baby, and the sling wasn’t suitable for the bad weather. That’s not the case anymore.
I don’t really know how much this has saved us so far, especially considering petrol prices have dropped so much recently. I estimate that it is saving us about £20-£30 a week by me not using the car as much.
It’s worth walking more. Not only will you save money, but it will also be better for your health. I find that I feel better at the end of the day when I’ve walked more.
Monthly outgoings saved: about £100
You can reduce your monthly outgoings considerably by making some slight changes. The debt consolidation has been a big one for us, but just small changes each month have added up for yearly savings.
We’ve saved £510.50 from a lot of our changes. Without the debt consolidation we would have saved £310.50 just from the smaller changes. Our total saving is more than £6,000 per year, which is much better put in the savings account and spend on the things that we really want.
I'm Alexandria Ingham, and am a work at home mommy and full-time freelance writer. Writing has always been a passion from a young age, but it was only in 2009 that I decided to use it to make money online. Since then, I've managed to make a career out of it and don't regret it.