Are household costs crippling your savings?

POSTED: 13th March 2013
IN: Personal News

The last thing you want to do at the end of the month is dip into your savings pot to cover the cost of essential expenses, including heating bills and rent payments.

undefinedHowever, with the latest figures from suggesting household bills have risen 25 per cent since 2008, many households may be struggling to make ends meet.

As the study found, the average monthly spend on rent payments is £577 - which is up 24 per cent from £467 in 2008.

If you are renting, then now may be the time to start saving a deposit for a personal mortgage so you can break free of the rental market.

The figures also showed gas costs have soared 52 per cent over the five-year period, while electricity costs have edged up 32 per cent.

These hikes in utility costs may have pushed some people into the red, while others have relied on their savings to tide them over.

Still, you can stay in the black by comparing your energy costs and using the same supplier to help bring down your costs.

Similarly, the method of payment you use for these costs can influence its size, so opting for a direct debit may prove the most cash-savvy way to keep on top of bills.

Personal finance expert at Michael Ossei suggested it was up to the individual to ensure they were not paying over the odds on utilities.

"Consumers need to help themselves by not burying their heads in the sand and realising that there are options open to them," he said.

"The first step is to take a long hard look at your household budget to see where you can cut costs. Making sure you are on the best possible deal for your home essentials will help you ease the financial pain and to beat price rises."

Lastly, treat your savings as part of your monthly outgoings and that way you will help to ensure you are building, rather than eroding, your pot.

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