How to reduce expenses and optimise your budget?
The global economy experienced a significant slowdown in the first half of 2020. The health crisis is the main cause. Undoubtedly, the tremors shaking the global economy are having a direct impact on our daily lives. Jobs are being lost, businesses are closing and purchasing power is falling all over the world. It's time to tighten our belts to make ends meet and, if possible, continue saving. So let's take a look at how to cut back in this new article.
How can you achieve this? All you need to do is find effective ways to reduce your expenses and optimize your budget. In this article, you'll find some practical advice on how to improve control of your finances in these times of economic and health crisis.
Re-evaluate your budget and the way you create it
The first thing to do is to analyze your budget. You'll only be able to reduce your costs if you can identify all your expenses. So define your income and draw up as precise a list as possible of your expenses. You can take inspiration from the budgeting templates available on the web. This is the best way to clearly track your expenses. In this way, you can assess which items can be reduced or even eliminated.
Renegotiate your rent
For most Swiss households, the cost of renting a home is the single biggest expense. If you can't eliminate them, why not reduce them? Yes, it is possible to reduce your rent thanks to the reference interest rate. This rate regulates the price of rents in Switzerland. It is calculated directly on the basis of the average mortgage rate applied by the banks. In March 2020, this reference interest rate has been reduced by 0.25 % to 1.25 %. This allows you to benefit from a legal reduction in your rent. Don't hesitate to submit a request by mail to your landlord. It will help you save money.
Evaluate your tax reduction potential
We don't always take advantage of all the tax breaks to which we are entitled. However, certain specific, social and general deductions can help you reduce your taxes and save money on your budget. Don't hesitate to use the various online simulators to find out which deductions you are eligible for.
Find the best prices by making comparisons
Buying from the first vendor you come across is not the best habit to get into. If you really want to reduce your expenses, you need to take the time to find the best prices for each purchase. To do this, you need to compare the prices charged by several vendors. The Internet is a very practical virtual showcase for this price comparison. If you have the time, you can also compare prices directly with stores. This applies not only to small, everyday purchases, but also to large ones. Every franc saved is important. By the end of the year, you'll have saved several thousand francs.
Reduce your transportation costs
Constantly driving around is not very environmentally friendly. It's also not the most economical means of transport. The cost of fuel isn't the only expense. You also have to factor in insurance and maintenance costs, as well as monthly payments if you haven't yet paid off your car loan. If possible, take public transport. You can also apply driving habits that can reduce fuel consumption. The savings can be substantial over the long term. If you're planning to buy a car, opt for a model whose fuel consumption translates into real savings on your monthly or annual fuel budget. Negotiate your car loan to take advantage of low interest rates. You can also buy it back with Lica services. Alternative means of transport should not be overlooked. They are environmentally friendly and can be very cost-effective.
Reduce your insurance costs
Certain types of insurance are compulsory in Switzerland. These include health insurance and third-party insurance for your vehicle. Depending on your status or profession, you may also be required to take out certain types of insurance. All this adds up to a significant monthly expense. Review your insurance contracts. You can remove certain coverages that cost you several thousand francs a year, but which are neither compulsory nor used. So, if you want to drastically reduce your insurance costs, keep only the basic coverages on each contract and make use of the following services professional services.
Adapt your finances
You can adapt your finances to your new habits. You can save a few francs by using a more affordable bank card that's better suited to your purchases. You can also find a bank account with lower account-keeping and transaction fees, and lower interest charges, if any. You should also consider pension plans, which offer lower contributions. Savings are an investment item to which you should pay particular attention. Choose your investments carefully, so that they yield higher interest.
Reduce telecommunication costs
Telecommunications are an indispensable part of our daily lives. Internet, television, fixed and cell phone lines make our lives much easier. Telecommunications is an expense item that needs to be studied carefully. In fact, you can reduce your expenses and make substantial savings on this single item. This is made possible by the large number of offers available from the various operators on the market. Once again, comparison is key. Your cable subscription may be more affordable with a competitor. The same applies to your telephone package and pay-TV package. Opt for low-cost offers that deliver satisfactory performance.
In conclusion, to reduce expenses
Reducing your expenses doesn't have to have a major impact on your lifestyle. It's possible to keep most of your day-to-day privileges while cutting costs and expenses. It's just a matter of knowing how to optimize your budget and being resourceful. That way, you'll feel the impact of the crisis less! You should also consider buying back your private credit if your rate is higher than 4.5%. With Lica, you benefit from a response within 24 hours and easier acceptance. Once your loan has been approved, Lica will pay you an additional cashback up to CHF 5’000.-. Make your no-obligation request!