To state the obvious, the two obvious ways to improve our finances are by either increasing income (see separate article) and by reducing expenditure. For many of us, making minor changes can make a significant difference to our financial wellbeing.
it is worth knowing exactly where our money does go. We may think we know, but if we were to account for every penny spent over a full month, we may be surprised at the results. A snack at work, a regular newspaper can add up over a month. Having done this we need to identify potential cost cutting areas.
it may feel like a hassle but comparing suppliers of energy, insurance policies, TV/broadband, banking facilities etc - can save us a huge amount of money. When the annual renewal quote comes through, accepting it is the easiest but not necessarily the most cost-effective way of reacting.
Changing shopping patterns
we all differ in the way we shop, but analysing our spending habits can save us money. Sales or offers can be utilised. What is it we buy but don't really need or even end up throwing away? Someone suggested that we should never go supermarket shopping when hungry - it's all too tempting!
Analysing bank statements
it's possible we set up a standing order some while ago and now can't really remember what it is we're paying. We could be over-insured, duplicating cover. We may have breakdown cover that actually we don't need (some cars come with cover provided). Membership to certain organisations is paid by direct debit and will continue until we take action to stop it.
huge savings can be made by driving differently. Maybe some journeys are unnecessary or we could double up with others to share the costs. There are often considerable differences in price at the petrol pump.
it may be that we can reduce expenditure by contacting our mortgage lender to see if we can extend the length of the mortgage or perhaps going for an interest-only option for a while.
when it comes to debts we need to think carefully about who is paid what. We need to target the debts incurring high interest and if possible utilise any savings or assets to help reduce expense on debts with high interest and other charges. Some strategy is needed to ensure our payments are prioritised.