Saving money as a household
Living with other people can be an expensive concept. Whether you choose to house-share with friends, start a family, or move in with other family members, there are tips that you can learn which will enable you to make savings. Take advantage of the fact that you are all living under one roof, by following some of our guidelines.
Pay off existing debts
Ideally, you will want to start your new money-saving project from scratch. Why not consolidate your existing debt with a loan (minimising your quantity of repayments each month), or make a decision to eliminate your existing debts immediately? Start with the debts that charge you the highest rates of interest and work your way down. In so doing, you will pay less interest over the course of the repayments and you can organise your household’s finances without the burden of existing debt arrangements.
As a household, make a list of all of the expenses that you will be paying together. For example, utility bills, food, household maintenance, etc. Having made that list, try to work out how much you are willing to spend on each of the items. Come to an agreement and add this on to the spreadsheet. Budgets need to be regularly reviewed as they are constantly subject to change. However, by budgeting as a household, you will be able to make savings where appropriate. It might only make sense to share a budget for bread and milk, but even so, every saving you make adds up. Monitor your spending against your budget, and you will be able to evaluate your progress.
Shop once a week
It can be tempting to go to the shops whenever you crave a chocolate bar, or packet of crisps. However, when you do this, you are creating a bad habit for yourself and spending more than is necessary. Having someone do the weekly shop begins the habit that you are only to eat what is in the house, and gets you into the routine of adding things to a shopping list each week. This means that only one outgoing amount appears on your budget, enabling you to track your shopping budget against what you actually spend. In addition, you will save money (e.g. on petrol) and time, by only going to the shops once a week.
Open a savings account
There a number of ISA’s or other types of savings account which offer you a good rate of interest. When discussing your long-term plans with your household, why not commit to doing something about them by setting up a standing order which transfers money from your bank account into a savings account each month? It can be exciting to watch the balance in your savings account grow (added to by the interest you receive), as you consider that you are taking steps each month towards your long-term goals. Although these goals might change, it is likely that you will still need money to achieve them!