3 Household Expenses That May be Ruining Your Budget

If you haven’t recently assessed your personal financial responsibilities, you may be surprised by the breadth of spending obligations on your plate each month. Household spending, insurance costs, credit card payments, and car expenses are only a few of the demands drawing from your earnings, month after month. Entertainment and communications costs add to the tally, along with a host of personal expenses you pay each month.

Disciplined discretionary spending is essential for healthy finances, but recurring monthly bills also furnish opportunities for saving. Do you pay too much for insurance? Is your mobile bill out of control? How much interest do you pay on your outstanding credit card balances? Answering these and other questions about your finances can help you identify problem spending and find cost-effective alternatives.

Insurance Cover

Insurance payments are hard to reconcile, because they don’t produce tangible items in exchange for the cash. Instead, you pay each month and hope you never file a claim. Despite the paradox, you can’t eliminate the expense. You are required by law to maintain adequate car insurance while you’re on roadways and your bank or lender won’t carry your mortgage, unless the property is fully insured. If you’re fortunate enough to own them, you’ll also need to buy insurance for boats, motorbikes, and additional real estate you own.

Left unchecked, the cost of insurance can become a heavy financial burden, dragging down other aspects of your finances. You can’t skimp on cover, but you may be able to reduce costs by adjusting your policy or switching to a more affordable provider. Choosing a higher deductible, for example, may result in savings on car and house cover.

Your driving record, the type of car you own, and even your credit file, all have impacts on the cost of car insurance. If you drive a sports car you’ll pay a higher premium, and a history of moving violations could also push your rate upward. Fortunately, it’s easier than ever to shop cover and get the best price on car insurance. Online resources compile information from many major insurance carriers, providing side-by-side comparisons and help signing up.

Communications and Connectivity

There are so many ways to connect with others, it’s easy to overpay for communication services. To uncover savings, consider the bills you currently pay. Do services overlap? Is your land line necessary? Are you paying too much for your mobile?
Reviewing your internet and phone bills ensures the services you pay for match your usage needs. Is your unlimited data plan worth the money? How important is your home internet connection? Is it possible to drop services for savings? Each case is unique, so personal analysis tells your story, opening the door to savings, without taking away from your ability to stay in touch.

Meals Out and Takeaway

Food is a fundamental expense, so runaway food spending can have a substantial impact on your bottom line. Meals out quickly undermine household food budgets, because each restaurant visit costs several times more than similar fare, prepared at home. Whether or not you enjoy cooking, it’s important to establish limitations on food spending, or risk running short of funds paying for this basic expense.

Last minute takeaway is another convenience that comes with a price attached. Rather than reacting when your family’s hungry, you can save money, proactively planning a weekly menu that accounts for nightly suppers and leftovers. With a menu in mind, it’s easy to put together a cost-effective shop, which reduces waste – adding to your food savings. When you do eat away from home or buy takeaway, use discounts, weekly specials, and other incentives to keep costs as low as possible. And treat restaurant meals as special occasions, so your family doesn’t expect to regularly dine out.

With such a sweeping series of expenses to account for, it can be hard identifying your most troublesome monthly bills. A close look at your spending habits shows where your money goes. Under scrutiny, unchecked food spending, communications costs, and insurance payments may prove to be among your costliest monthly commitments.

Paul graduated in 2001 with a degree in Finance. Since then he has gone on to work for several of the UK's most well-known financial institutions.

An avid blogger and a huge football fan, Paul is here to guide you through the ins and outs of personal finance and perhaps save you some money in the process!

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