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How to Prepare for Winter and the Rising Cost of Living

How to Prepare for Winter and the Rising Cost of Living
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There’s no denying that we’ve got a tough winter ahead. In terms of our finances, we’ve already noticed the rise of things like petrol prices and household bills, and it’s been predicted that these will only get higher. Essentially, the cost of living is increasing, and most of us are feeling the pinch.

So how do we prepare for such a turbulent winter? There are a few things you can do in order to cut costs, and while they’re not always easy, they could be necessary. We’ve looked at a few ways you can prepare for a challenging season below:

1. Review Your Budget

Do you have a household budget? If not, now is the time to make one! While keeping to a budget may sound restrictive, this doesn’t have to be the case. A budget can be as strict or loose as you want – the main thing is that you’re balancing your budget and not overspending. You don’t have to set aside hundreds of pounds each month if you can’t afford it.

Creating a budget allows you to feel more in control of your financial situation. The first thing you need to do is write out all your monthly expenses, and take into consideration any large one-off or yearly expenses, such as your MOT or dental bills. Compare these costs to your income and ensure you’re spending within your budget. Next, see where you’re able to cut back – non-essential expenses like eating out and entertainment can probably be reduced. 

It’s not realistic to think you’ll be able to completely cut out these types of expenses. But it’s important to categorise the things you need and the things you want, and prioritise accordingly. 

2. Get on Top of Your Finances

Interest rates are likely to rise again, so it’s more important than ever to get on top of your debts. Particularly if they are higher interest debts to begin with, such as credit cards. So while it may seem odd to put a large portion of your income towards paying off debt, this is probably a good option. Once you’ve paid off this debt, you’ll have more room in your budget for things you’d prefer to spend on.

Alternatively, you could look to move your debt to a cheaper rate option. This could include a personal loan or a 0% credit card. These improved rates are more likely if you have a better credit score, but there are ways in which you can improve your credit rating before you apply. With these credit options, you’ll probably be paying more towards the actual debt each month, rather than just the interest.

3. Compare Prices

Although most providers these days have got comparable rates, it can still be worth shopping around. There’s a chance that you will be able to find a cheaper offer, especially if you use a comparison site. Loyalty to a particular company can end up costing you more, so don’t be afraid to switch as often as needed.

It can be sensible to look at all your major outgoings in terms of comparing prices, not just your utility bills. Your mortgage rate might be able to be reduced, for example, or your car insurance. You may not be able to save a huge amount each month, but any savings will add up over time.

4. Invest in Insulation

Insulating your home can be a big expense. However, if you’re planning to live in the same house for a number of years, it’s usually a good investment. You won’t need to turn up the heating, as your home will be more energy efficient, and warmer already.

In an uninsulated home, around a quarter of the heat can be lost through the roof. This means that your boiler will be having to work harder, which will cost you more money. So insulating your roof can save you heating costs in the long run. A boiler jacket can furthermore be a good investment, as can replacing your boiler for a more efficient model. You might even be eligible for government funding to help with this cost.

5. Cut Back on Subscriptions 

Lots of people have a huge number of subscription payments coming out of their bank account each month. Whether it’s Netflix, Amazon Prime, Audible, Disney+, or a gym membership, you’ll probably subscribe to at least a few services. The question is, do you need all of them? With video streaming in particular, it may be sensible to stick to one or two, rather than subscribe to all of them. Consider which ones you use regularly, and cancel the rest.

If you have any TV packages, it’s also a good idea to see what you’re actually signed up for. Do you use all the packages, such as sports or kid’s channels? You may have got a cheaper rate when you signed up, but are now paying a small fortune for packages you no longer use.

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