If you’re struggling to make ends meet every month even though you’ve made a load of cuts, your problem might be the house itself. If your house is costing you too much then you’re never going to balance the books unless you make some drastic changes. There are a lot of ways that your house can suck up money so if you’re wondering where all of your cash is going, have you considered these things?
Mortgage payments are the biggest monthly expense for most people and if yours are too high, there are a couple of reasons. Firstly, you might be paying a lot more interest than you need to be. If you can get a better deal elsewhere, you might be able to remortgage the house and reduce the amount that you’re paying each month. If your fixed rate has ended and the interest rate has shot up a lot, see if there are any better deals out there and switch. It’s also worth considering the value of the house. Interest rates are usually tied to the value of the house, the more it’s worth, the less interest you pay. That means if the value of your house has gone up since you took out the mortgage, you could find a much better deal by remortgaging it and cut the amount of interest you pay each month, making things a lot more manageable.
If you cut the interest rates you’re paying and you’re still struggling, you might have to face a harsh truth and accept that the house is just too big and it’s time to downsize. Downsizing is a great way to save money because you’ll be paying a lot less into your mortgage and you’ll have a bit of spare cash from selling the old house if you don’t put it all into a deposit on the new place. It’s also going to be a lot cheaper to pay utility bills on a smaller place (we’ll come back to that later). Get some advice on how to sell your home and start looking for smaller places. People often think that they just wouldn’t be able to live in a smaller house because they wouldn’t have enough space but once you move in, you’d be surprised how much of the space at your old place was just wasted or filled with useless junk.
This is the other big drain on your resources but you can easily cut it. Do all of the usual stuff like switching lights off when you’re not in the room and turning the heating down a little, but also look at your appliances. If you’re using old light bulbs and appliances that aren’t energy efficient, swap them out for something more modern and the running costs will go way down.
A house that’s falling apart at the seams is always a drain on your finances. When you’re constantly paying for repairs, you’re always exceeding your monthly budget and planning is difficult because you never know when things will break. You should try to repair a house up to a point but there comes a time when you should cut your losses and sell up.
Your home could be draining all of your money but if you follow these steps, you can get your finances in order again.