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Are you spending your way into debt?
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| (C) Rex Pictures |
Step 1: Dress for less
These days you don’t have to wear Prada to look posh – in fact, getting the celebrity look at budget prices is the latest fashion. According to research company Verdict, by the end of 2006, £1 in every £4 spent on clothing went to “value retailers", the Daily Mail reported. So do you really need to spend £200 on that designer dress when you could get something similar at Primark for £10?
Step 2: Shop around for insurance
The Post Office reckons homeowners waste about £600m a year paying more than we need to on home and life insurance. That’s because nearly 5m of us just go with our mortgage lender’s products rather than bothering to shop around for cover.
“Many homeowners don’t realise taking out buildings and contents insurance with their mortgage lender is generally not the best value deal. And it’s not compulsory to secure their mortgage,” Phil Ashkuri of Post Office Financial Services warns.
dealing with debt
Step 3: Switch energy suppliers
Nearly half of all UK households have never bothered switching electricity and gas providers despite the big cash savings up for grabs. Consumer group Which? reckons households can save around £245 a year on average by moving providers.
Step 4: Get a better credit card
While there have been fears that good 0% balance transfer deals on credit cards were a dying breed, there still seem to be plenty of great deals around. So if you’ve got a hefty credit card debt on which you’re paying interest each month, why not look to shift it to a 0% offer and try to get it paid off before the special deal ends.
A range of cards offer 0% for 12 months or more, including Barclaycard Platinum and Flexi-Rate, Virgin, Capital One Platinum and the Tesco Bonus card, among others. But remember these cards generally come with a balance transfer fee, so do your sums first.
