The coronavirus pandemic has created a financial strain on households across the globe. Whether you need to make ends meet with far less money or rebuild an emergency fund that got you through the worst of the crisis, many people feel like they need to reduce their monthly expenses, but they may not know where to start. Even if reducing your expenses might seem impossible, you can often figure out some additional ways to minimize your expenses. With more people working from home than ever before, some expenses have already been reduced, such as transportation. However, many other steps can also be taken. The following are some ideas to consider:
1. Consolidate debt
Whether you have debt from student loans, credit cards, or other sources, consolidation can often save you a great deal of money each month. Individuals should check on the interest rates of their various debt, including student loans, as current rates are very low and consolidation can save you a lot in interest while reducing your monthly payments. Several companies exist for the consolidation of student loans, and balance transfers or personal loans can be used for other forms of debt. Many balance transfer offers come with a no-interest period, which can help to minimize debt. Keep in mind that it is important to read the fine print and avoid getting caught in a worse situation down the road.
2. Invest in home upgrades
People who feel that they spend too much on their utilities should first try to scale back on their use of electricity and natural gas. Beyond that, investing a little bit of money upfront can save you a lot on your monthly bills. For example, LED lightbulbs are about four times more energy-efficient than incandescent ones and can significantly reduce your monthly bills. Another affordable upgrade is a programmable thermostat, which automates heating and cooling. While new windows or insulation are much more expensive and perhaps out of reach for many right now, they are worth looking into for the future. With some upgrades, individuals can obtain government assistance or tax breaks, such as installing solar panels, which can also reduce your energy bills.
3. Consider cheap entertainment options
Whether you opt for cable or streaming services, the cost of these entertainment sources can quickly add up each month. Rather than pay for multiple services at once, people should look into more affordable options. For example, local libraries often have extensive video collections and some even support various digital downloads of content. Also, with some streaming services, individuals can reduce their costs by allowing commercials to air.
4. Cook at home
Amid the pandemic, many people have become more comfortable preparing meals at home. However, some individuals may still rely mostly on take-out when it comes to their daily meals. Ordering prepared food can easily become one of the biggest expenses in a given month. Taking the time to prepare meals at home can save people a lot of money, while allowing them to learn a new skill that they can carry into the future. Preparing food at home also generally means that it will be healthier since you know exactly what was put into it. Healthier meals can, in turn, reduce the costs associated with visiting a doctor, so this is a great option to save money.
5. Buy in bulk
While warehouse stores such as Costco and Sam’s Club require that you purchase a membership upfront, the amount of money that you save by buying in bulk usually offsets this expense rather quickly. However, other options exist and people can frequently order in bulk through various websites or directly from their favorite companies. Searching for coupons can help to lower the price even further. Buying in bulk often means spending a lot of cash upfront in order to avoid spending money on those items over the next several months. Ultimately, buying in bulk saves money compared to purchasing a smaller volume and is worthwhile for key household items.
6. Bundle insurance policies
For many people, insurance is a significant monthly expense. Often, different forms of insurance can be bundled together to save money. For example, if you obtain auto and homeowners’ insurance through two different companies, you can contact them to find out if they can bundle both in order to save on premiums. Most insurance companies will offer a significant discount for bundling. If this is not possible, then people may want to contact their insurance carriers to talk about how they can lower their rates. This strategy is especially useful for people who can no longer drive to work every day and therefore spend much less time on the road.
7. Relocate
While the thought of relocating to a less expensive area might seem drastic, it can help to reduce many of your bills, ranging from housing to insurance. Since many people plan to work from home for the foreseeable future, they are looking more closely at their choice of living locations and opting for something different. People may want to consider moving to a suburban or even rural area that provides more space for much less money. Of course, you need to factor in the cost of the actual move to ensure that they can afford this option.