Cut the cost of your home by 50% today

Cut the cost of your home by 50% today

Corin Vestey - Everyinvestor.co.uk

September 29 2006

Is your home your biggest monthly expense? You could be overpaying by as much as 50% for your mortgage, insurance and energy bills. Here's how to slash your outgoings back to a reasonable level.

The three main areas of expenditure I am going to look at are:

  • Your energy consumption
  • Your mortgage
  • Your insurance

Cutting your bills is a necessity these days

Gas and electricity prices have soared over the last year and higher energy costs are probably here to stay for the foreseeable future. Water prices have also now risen and may well do so again.

Worse still, Gordon Brown may well take over from Tony Blair next year. When he does expect taxes to rise even more steeply than they are at present. Council tax is already a bad joke. All these threats to your finances mean that cutting your bills back now should be top priority.

There are two ways to do this. The first is to switch to a cheaper supplier, and/or a cheaper tariff (such as a duel fuel tariff) and take advantage of any available discounts - such as for paying by direct debit etc.

Don?t put up with expensive utility bills. Switch suppliers online now

Use energy more efficiently to slash those bills

The other way to reduce the cost of living is to use less energy and water in the first place. This is much easier to do than some people think and can actually get quite addictive, plus you can feel virtuous because you've done something for the environment.

For those on lower incomes, grants are available from local and central government to subsidise energy efficiency.

I've got two checklists for you. One list for energy saving and one list for water saving. Some of the tips won't actually save you very much cash on their own but do them all and the savings mount up plus they could do a lot for the environment if everyone starts doing them.

Save as much £494 a year on energy

  • Install loft insulation 10 inches thick and you could save £140-£170 a year
  • Install cavity wall insulation and save £100-£120 a year
  • Replace an old boiler and save £80-£90 a year
  • Buy energy-efficient fridge freezers and washing machines (save £35 a year)
  • Turn your thermostat down a degree and save £30 a year
  • Insulate your hot water tank with a jacket and cut your bills by £15 a year
  • Install energy saving light bulbs and save up to £7 a year
  • Filling and using low settings on washing machines/dishwashers can save £2.50 a year
  • Turn appliances off standby to save around £25 a year

Nine to save money by using less water

  • Don't fill the bath completely.
  • Take a shower instead of a bath
  • Don't use the dishwasher or washing machine half-empty
  • Use a bucket or watering-can not a hosepipe
  • Don't run the tap when brushing your teeth
  • Don't flush the loo at night (if you don't really have to)
  • Put a 'hippo' or other device in your toilet cistern
  • Collect rain water with a water butt for the garden/car
  • Use a washing-up bowl instead of running the tapv

Saving money on your mortgage is easy

Now let's look at the big one: the mortgage. For most people the mortgage payment is the single biggest outgoing they have so it makes sense to reduce it as much as possible. The last interest rate rise took rates to 4.75% and another rise is considered likely before the end of the year.

Re-mortgaging now to lock in a low fixed, discounted or tracker rate could be an excellent move if you are paying your lender's Standard Variable Rate (SVR). SVRs are typically around 6.75% at present and our best buy mortgages start at 4.45% so that represents a saving of thousands over two or three years.

Everyinvestor believes that you should always use an independent no-fee mortgage broker to re-mortgage - we recommend London & Country. They can advise you if you will save money by re-mortgaging, search most of the available mortgage deals for you and deal with lots of the paperwork for you. These three factors make L&C's service invaluable - which is why I and other Everyinvestor staff use them.

Cut the cost of essential insurance

As the mortgage companies and fire service constantly remind us buildings and contents insurance are 'must-haves'. But that doesn't mean that you have to pay over the odds. Don't just accept your renewal quote, it is very easy to shop around these days and you could get a discount of as much as 20% for buying equivalent cover online.

Don't forget to make a proper attempt to value the contents of your house. Vast numbers of people are underinsured and this could lead to heartbreak when in the event of a disaster. It is better to err on the side of caution when estimating the insurable value of your goods. And don't forget smoke alarms, they are a lifesaver.

As ever, remember to check policy documents thoroughly and compare any current policies with new ones to ensure that you are will get the same level of cover or better. Don't leave yourself uninsured by cancelling your old policy before your new one is in place.

Note: Awesome Africa Handyman is not the Author of this Article (refer to top of Article), and has made no changes. The validity and accuracy of the content lies with the Author.

 

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