Don’t be overwhelmed by household expenses. If your budget is out of control, there has never been a better time to take action and trim household bills.

Operate your household like a business

Simply put, don’t spend more than you earn. It’s important to identify your discretionary        (non-essential) and non-discretionary (must pay) expenses. Non-essentials, for example take-away food and coffee, that new outfit, or that gym membership that you’re not using. Essentials such as food, accommodation, be it mortgage or rent, and transport. Cover your essential expenses first, including a 5-10% savings target, to start getting finances on track.

Time for homemade food

Try to limit take-away as those little indulgences soon add up. With more time being spent at home, keep costs down by having some fun and getting creative in the kitchen. You will be amazed by the positive impact on your budget.  Check out these flavoursome budget family meals that all come in under $5 per serve. Use leftovers, don’t toss them, as it’s like throwing money away. Be proactive and cook enough for 2 meals and freeze one serve for later.

Don’t get shocked by power bills

It’s important to do your homework on energy as there’s plenty of room to save. If you have a choice of providers do comparisons to find the best deal for you. Go to to see what savings may be available. Remember to have your latest electricity bill handy for accurate usage rates.

Plus, here’s a few simple tricks to cut power costs.

  • Slash your energy bill by up to 10% by turning appliances off at the power outlet when not in use.
  • Set your air-conditioner to DRY mode and effectively cut your running costs by half, while still keeping your home comfortable. Keep your air-con running efficiently by regularly clean filters.
  • Ditch the second fridge One in four homes have a second fridge, and it can add an extra $172 to your annual power bill – more if it’s an older model.
  • With new appliances, look for high star rating energy-efficient appliances. Sometimes they may cost a little extra but you’ll save over time. For instance, a flat-screen TV with a high star rating can cost $60 a year to run, compared with $148 for a TV with a three-star rating.
  • Switch to LED globes and save $$$ off your annual electricity bill!

Take action on your debt

Credit cards can be handy, but they can also get out of control if not used wisely.

It’s a fact that more than 10 per cent of Australians take 6-24 months to pay off their Christmas debt.

If you’re having difficulty here are some things you could consider.

  • Contact your credit provider’s hardship department to discuss organising a repayment plan.
  • Arrange for credit-card repayments to be direct debited from your bank on pay day.
  • Consider a 0% balance transfer offer to minimise interest payments and pay your debt down quicker. As well as the transfer fee, take note of the credit card annual fee and what rate you’ll be charged at the end of the promotion. The right choice depends on how much you owe and what you can afford to pay each month. Most important is to not use the card; and focus on clearing the debt.
  • Consolidate debt: When you have multiple debts, consolidation might be an option. By consolidating your debt into a personal loan, you make one repayment each

month instead of several. Plus, your debt will be fully repaid at the end of the loan term.

  • Consolidate bank accounts: Multiple bank accounts and credit cards mean multiple fees. Consider consolidating to reduce fees, and your monthly expenses with it.

Reassess your health insurance

You should review your health insurance regularly to see what’s right for you. With prices skyrocketing an average of 29.75 per cent over the past five years, families are now paying about $4200 a year for a combined hospital and extras policy. Health insurance comparison companies can assess if you’re paying too much. Here’s some other ideas to consider.

  • Mix it up Use one provider for hospital cover and another for extras.
  • Consciously uncouple There may be no benefit in having a couple policy. Two singles may be better as you could remove female requirements such as obstetrics for the male partner and keep for the female. You can ask your comparison company if this may benefit you.
  • Turn off items Consider ‘turning off’ items you don’t need to be covered for in the immediate future. Caution is required if doing this to reduce premiums, as you may need to serve waiting periods again if you switch them back on.

In these challenging times the last thing you need is to spend a chunk of your hard-earned cash on medical bills. So, ensure you eat right, get in some daily exercise, and keep your home environment clean and sanitised so you stay healthy.

Talk cheap

People with mobile phones spend an average of $77 a month on their plans – more than double the average spent on prepaid plans. Here’s some ways you could save on mobiles.

  • Know what you use Avoid blowing your budget with excess data charges by taking a look through your recent bills to see your usage patterns and make sure your plan suits your needs. About 40% of mobile phone users regularly exceed their data cap, costing an extra $300 million annually.
  • Swap to a SIM-only month-to-month plan Costing an average of $36 per month you have potential savings and you’re not locked into a plan with the same provider for several years.
  • Bundle packages Transfer data between your home WIFI and mobile device with a bundled package or data-sharing plan that enables this.
  • Shop around for providers Look beyond the large providers to find a generous serve of savings.

Master your mortgage

You can potentially save more than $22,000 in interest by refinancing a $400,000 30-year loan to one that’s just 0.25 per cent cheaper. You need to assess the costs involved to switch by adding up the costs of refinancing and then dividing by your monthly repayment savings to establish the number of months you need to recoup the costs. If refinancing is not an option and you’re still struggling with home loan repayments, consider these options:

  • Apply for a hardship variation with your lender Normally given in the form of frozen repayments, frozen interest rates and/or partial repayments. Remember, interest will still be added to your mortgage.
  • Access some super This may be possible on compassionate grounds, so check with your super provider. Release is only given if your lender is threatening to sell your home and you can’t pay the arrears by any other means.
  • Find somewhere cheaper to live If a big chunk of your monthly income goes towards keeping a roof over your head, maybe it’s time to find somewhere less expensive. If mortgage repayments are too much to manage, consider renting out your home and living somewhere cheaper. Deciding to sell is difficult, however you’re more likely to get a better price and avoid legal costs if you do it yourself, rather than have the lender take it.

Acknowledgments: Australian House and Garden, Safe Financial,,,,