If you haven’t felt the impact of rising costs yet in 2022, you’re among the lucky few. Even people who have been in great financial shape for the past few years are struggling. The lingering effects of the economic chaos caused by the pandemic, along with Russia’s invasion of Ukraine, have caused prices to skyrocket.
That looks unlikely to change anytime soon, and you may be looking for ways to keep your costs down in light of this. Here are some tips for budgeting to keep costs down.
Get Cheap Renters Insurance
Insurance is ubiquitous in modern life. It is crucial for financial health. However, it does not all have to be expensive. You can get a renters insurance quote that starts at as little as $5 a month that will cover your possessions. Renters insurance will include cover for your phone and laptop, as well as personal liability.
If you’re a homeowner, take an inventory of your possessions to determine whether you are over-insured for home contents, and cut your premium down if possible.
Use a Budgeting App
Creating a budget can improve your financial health significantly. However, you may not have the skills or time to create an effective budget. The good news is that you no longer need to do the work yourself. Instead of going through your bank statements with a fine-toothed comb, you can get an app to do it.
Apps like Mint connect to your bank accounts and use AI to sort payments according to different categories. If some items are miscategorized, you can sort them manually and the app will remember this for the next time. You can even create categories of your own if you have expenses particular to your lifestyle or career.
Simply having a budget gives you the clearest path to finding ways to cut down on costs. You can create goals and measure your progress by comparing them on a month-to-month basis.
Cancel Unused Subscriptions
The modern world has provided us with a huge range of services that replace the outdated ones. For example, streaming services have replaced cable for many Americans. Instead of paying one big price for limited content, you pay smaller monthly fees for far more content on demand.
However, there are so many online services now that it is easy to forget about them. Many people have subscriptions to services they haven’t used in months. A subscription may cost just $10 a month but that adds up.
Go through your finances (if you use a budgeting app this will be simple) to find subscriptions you’re no longer using. Consider whether you really need a streaming service you only turn to once in a blue moon. Consider whether you need both Spotify and Apple Music.
You can save a fair amount of money by cutting down on your unused subscriptions. You’ll see the benefits reflected in your monthly budget. There are apps to help you find those subscriptions if you are struggling to do so.
Pay Off Debts With Savings
It is extremely important to have savings. In theory, you should always have as much in savings as possible, no matter what else is going on. But if you have debt, paying it off may be a good financial decision.
This is especially true if you have debt with high interest rates. In all likelihood you are paying a lot more in interest on your debts than you are earning in interest on your savings. By paying off your debts, you get rid of the high-interest monthly payments. This may improve your budget significantly in the short term.
You can use some of the extra money available each month to start replenishing your savings. You’ll take a while to get back to where you were, but you will no longer be hemorrhaging money in interest on old debts.
It is becoming increasingly important to find ways to save money in 2022. While there are no quick fixes, there are some steps you can take to minimize costs. Do as much as you can to cut unnecessary payments and make a budget with monthly goals.