ORGANISE your finances before a hard winter sets in.
Energy bills are going up again next week, meaning NOW is the time to reassess your bills and outgoings.
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Consumer expert Martyn James says: “Soaring energy costs have put everyone’s heads in a spin.
“Dealing with difficult decisions about your finances can seem overwhelming, but once you tackle them head on, the pressure is much less than the burden of not knowing.”
Mel Hunter explains how to give your finances a makeover.
Check subscriptions
IF the money game is going against you, you need to make sure your subs – the subscriptions that litter your bank statements – are on your side.
Jo Thornhill, money expert at MoneySuperMarket, says: “Make a list of all your subscriptions, then cancel any you don’t use, or had forgotten you have.
“You can always cancel a subscription and see if you miss it.”
To spot subscriptions, go back through at least 13 months of bank statements and note anything you don’t recognise. Why that long?
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“Because many businesses sign you up to yearly payments that might have slipped under your radar,” says Martyn.
Also check for any duplicate services, says Jo. If you’ve got Amazon Prime, which includes music, do you need Apple Music or Spotify as well?
Enjoy free trials – but put a date in the diary to cancel when that period ends.
You can get a Tastecard free for 60 days, saving an average £19 per meal out.
That would add up to £95 if you eat out five times during the trial.
Once you’ve checked your bank statements, check your phone bill for sneaky subscriptions.
Martyn says: “You can end up paying for subscriptions and apps through your phone bill and many people don’t notice.”
He also warns of subscriptions that go under names you don’t associate with the brand, adding: “Question any regular payment on your statements that you don’t recognise.”
If you’re paying out for online storage, set yourself a mission to find out exactly what you’re forking out for and why.
Tech firms cash in on our failure to understand how their world works, so you can probably find a cheaper solution once you know what you’re paying for.
Check the terms and conditions of any subscription you’re thinking of cancelling, to avoid hefty exit fees.
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Make a spreadsheet
IT’S all too easy to let money matters slip to the bottom of your to-do list, so making a start is the most important step of all.
Use a notepad or spreadsheet to list the money you have coming in and the money going out.
You can find a budget planner spreadsheet, which analyses your finances, at moneysavingexpert.com.
Record all your direct debits and standing orders, as well as what you’ve spent on things like travel, food, takeaways and presents.
Look at three months of bank statements and then divide your total spend on each category, say takeaways, by three so you can pinpoint the average amount you spend on it a month.
Martyn says: “You’ll be left with a pretty stark demonstration of how much you have left over each month.”
If the answer is very little or nothing at all, you need to take action, cutting the amount of money going out and increasing the cash coming in.
Deal with your debt
IF you have savings and debt, you should use the savings to get out of the red.
If you have debt stacking up in more than one place, prioritise the one with the highest rate of interest.
Do you have a good credit rating? Then you should switch any credit card debt to one with the lowest level of interest.
But remember, you’ll usually pay a fee to do this.
Martyn says: “Ask the business you owe for help. They should come up with solutions to help you buy some time while you get on your feet.
“They should also consider suspending interest and charges for a short period if it’s making your situation worse.”
Contact a debt advice charity like StepChange, which offers a free service. Don’t wait until you hit crisis point.
And always be aware of scams – sadly, fraudsters even prey on people seeking debt advice.
Check any organisation you use, especially those that ask for a fee, is on the Financial Services Register.
Increase your income
COULD you earn money on the side? One in five adults has a side hustle – like being a dog-walker – but you must tell the taxman if you take in more than £1,000.
There are other ways to bring more money in. To ensure you are getting all the help you’re entitled to, complete the benefits checker at turn2us.org.uk and also find out if you are affected by any of the changes in yesterday’s mini-budget.
And check your council tax band. Around 400,000 homes have been placed in the wrong band.
Also consider using an NHS prepayment subscription for any medication.
If you need two prescriptions a month, you could save £116 over the year.
‘As wage lands I plan our meals’
RISING bills mean care home worker Natalie Parker, 35, from Farnborough, Hants, has to literally count every penny.
Natalie eats at work to save electricity, and limits hot water to an hour a day at home with children Chloe, 17, and Jack, 11.
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There are times when her £10 an hour wages and Universal Credit support don’t stretch to the end of the month.
The only way to make ends meet is look at everything she spends and look for saving opportunities.
Natalie works around 32 hours a week. he said: “As soon as my wages land in the bank I write down all our outgoings and plan meals for the month ahead. I budget to the penny.”
She is paying back a £100 a month debt plan, including water bill arrears, after using a credit card to pay for a dance trip for Chloe before the pandemic so her daughter wouldn’t miss out.
“I ended up with four credit cards. I used to dread opening bills. But I stopped burying my head in the sand and asked for help.”
Her budget is still very tight, especially with her energy bill with Scottish Power recently tripling from £60 to £178 a month.
Having a poor credit history means Natalie would struggle to switch providers for her other bills, but she has still been able to bring her costs down.
She renewed her car insurance, taking it from £42 to £38 a month and ditched her Now TV package, saving £8.99 a month.
She also found she was paying too much with broadband provider Plusnet because her contract had finished.
She got a new deal for £18, down from £42, putting £24 back in her pocket each month.
