Managing Money During Price Hikes

20 April 2022|Related :

In the current cost of living crisis, many Brits are struggling to make ends meet due to rising inflation, fuel, utility bills and other living costs.

Along with the added uncertainty of the geopolitical climate as Putin’s war against Ukraine continues, many are feeling more anxious about their financial situation than ever.

In this guide, we’re going to be giving some tips on how you can manage your debts and make your money go further during the current price hikes.

Conduct a Full Audit of Your Spends

When looking for ways to save money, many people make the mistake of looking too much at the bigger picture. Instead, you should be focusing on each and every thing you spend your money on.

Cut Out Unnecessary Spending

The first step to lowering your monthly spending is to cut out the wants and keep the needs.

‘Wants’ are unnecessary items/services that in reality you can do without (even if you think you absolutely need your Friday night takeaway)

Common unnecessary spends include:

  • Nights out 
  • Takeaways (including coffee, such as Starbucks and Costa)
  • Ready meals
  • Clothes you don’t need
  • Club or Gym memberships
  • TV subscription services (Netflix, Prime Video, Disney +)

One of the easiest ways to stop yourself from unnecessary spending is to plan out your weekly shop before you go- think about your meal plan, check what ingredients you already have in and only buy the things on your list. 

Most importantly, avoid the middle aisle at Aldi altogether, you don’t need that mini pizza oven!

Make Savings on the Necessities

Once you have stopped spending on the unnecessary things, it’s time to look at how you can reduce your spending on the things you need, such as your broadband and water bills.

Ask yourself “Am I doing this the cheapest way?” and if the answer is no, or if you are unsure, it is worth going online and using money makeover guides and comparison sites to find the best deals and work out how you can save a bit of cash.

Water Bills

If you’re currently on a rateable water bill, see if you can make the switch to a water meter as this only counts the water you use and can work out a lot cheaper.

Energy Bills

Energy prices are expected to rise by £2,000 for each household by October later this year.

The average UK household sets its thermostat to 20ºC, two degrees higher than the World Health Organisation suggests is the ideal temperature for healthy and well-dressed people.

Turning down your thermostat by as little as 1ºC could potentially save you up to £80 per year, so by lowering your heating from 20ºC to 18ºC, you could cut £160 off your annual heating bill. 

However, please note that a higher minimum indoor temperature than 18°C may be required for vulnerable groups such as older people, children and those with chronic illnesses, particularly cardiorespiratory disease.

Phone, Internet and Television Bills

If you call your phone, broadband and TV providers, you can usually end up with a much better price than you started with.

Phone them up and ask to hear about cheaper packages or ask for a discount. If they won’t budge on the prices, it’s worth mentioning that you’re thinking about leaving and going for a cheaper provider. 

More often than not, they will magically produce a great offer that wasn’t available before in order to keep you as a customer.

Shopping Bills

One of the most common poor spending habits many people have is buying all brand name products. These can often cost more than double that of a supermarket own brand product that does the exact same thing or tastes almost identical.

In the table below, we have compared the prices of common grocery items from top name brands and a supermarket (Asda) own brand.

Category Product Average Brand Price Average Supermarket Brand Price Average Cost Saving
Confectionary Chocolate Bars (6 Pack) Mars £1.87 Asda Caramel Chews £0.65 £1.22
Condiments Mayonnaise (500ml) Hellmann’s £2.50 Asda £0.75 £1.75
Cleaning Washing Up Liquid Fairy £1 Asda £0.45 £0.55
Cereal Honey Nut Cornflakes  Kelloggs £3.30 Asda £1.00 £2.30
Toilet Rolls Classic 12 Pack  Andrex 7.45 Asda £4.20 £3.25
Frozen Food Peas (1kg) BirdsEye £2.88 Asda £0.80 £2.08
Rice Long Grain (250g) Ben’s Original £1.05 Asda £0.35 £0.70
Cooking Sauce Bolognese (500g) Dolmio £1.55 Asda £0.70 £0.85
Washing Liquid Non-Bio Liquid (1.5L) Persil £7.00 Asda £3.50 £3.50
Herbs & Spices Mixed Herbs (11g) Schwartz £1.65 Asda £0.45 £1.20
Milk Semi Skimmed 2L Cravendale £1.95 Asda £0.95 £1
Crisps Sea Salt Sharing Crisps (150g) Tyrrells £2.29 Asda £1.00 £1.29
Cordial Apple & Blackcurrant (1.5L) Robinsons £2.63 Asda £1 £1.63

By opting for the supermarket own brand of these items alone, you could cut over £20 off your weekly shopping bill!

For more of the latest financial news and guidance, check out the rest of our handy blog guides.

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