Common Household Spending Problems

There are several common household problems that many families don’t even realise is having an impact on their finances. The only way to find out where you could be wasting money; is to start by identifying exactly where your household’s earnings are being spent.

Look at your budget

Don’t have one? This is your first mistake. One of the best ways to be able to identify seemingly black holes in your spending is to outline what all of your expenses are. Draw up a budget outlining how much you are spending on your car and home insurance, your electricity bills, your groceries, right down to how much your child’s sporting activities cost. Leave nothing unaccounted for.

Not looking for a better deal

Once major mistake many families make is not shopping around for the best deals when it comes to credit card interest rates, home phone and Internet packages, car insurance, health insurance and even their mortgage.

Take the time to go through your policies and find out if you can get a better deal elsewhere. Call around, research online and get quotes. If you didn’t put in the hard yards to make sure you are getting the best rates, then you will probably be able to save yourself hundreds just by shopping around.

Not taking advantage of bundling services

Many companies, whether they be insurance or telco providers, offer discounts for package deals. So if your home phone and Internet is from one provider and your mobile phone services are with another, see who can offer you the better deal and bundle your services. Not only will this save you money, but it’s also easier when everything is in the one place. It’s also good to do this with your insurance as well.

Spending too much on electricity bills

Are your power bills through the roof? Many families struggle to keep their electricity bills down for a number of reasons. Here are a few ways to dramatically reduce your household energy consumption:

●  Educate your children about how to save electricity. For example, put on warmer clothes rather than turning on the heater and keep blinds closed during the hottest parts of the day to keep an area from heating up from direct sunlight.

●  Turn off appliances at the switch; everything from microwaves to televisions are still using power even when they are in standby mode.

●  Use energy efficient appliances and light bulbs, The higher the star rating, the more energy efficient the appliance. As you need to replace each item, buy a replacement that’s really efficient. It will save you money in the long run.

It’s easy to let household spending get out of control if you are not entirely sure where the money is actually going. But the good news is if you create a budget, and take steps to reduce the amount of outgoings, you can rectify your spending habits easily, and get your family’s finances back in great shape, fast.

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