How to reduce your expenses and optimize your budget?
The world economy is experiencing a significant slowdown during the first half of 2020. The health crisis is the main cause. Undoubtedly, these shocks which shake the world economy have direct repercussions on our daily lives. Job losses, business closures and declining purchasing power are rampant around the world. So now is the time to tighten our belts so that we can make ends meet and, if possible, continue to save. We will therefore see how to reduce your expenses in this new article.
How do you get there? You just need to find the effective methods to reduce your expenses and optimize your budget. In this article, you will find some practical advice to improve control of your finances in these times of economic and health crisis.
Reassess your budget and how to develop it
The first thing to do is to analyze your budget. You can, in fact, reduce your expenses, only if you manage to identify all the expense items. So, define your income and establish as precise a list as possible of your expenses. You can take inspiration from the standard budgeting models available to you on the web. This is the best way to clearly track your spending. Thus, you will be able to evaluate the positions which could be reduced or even eliminated.
Renegotiate your rent
The cost of renting accommodation is the main expense for the majority of Swiss households. If not eliminating them, why not reduce them? Yes, it is possible to lower your rent amount thanks to the benchmark 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 benchmark interest rate fell to 1.25 %, thus registering a decrease of 0.25 %. This reduction allows you to benefit from a legal reduction in your rent. Do not hesitate to submit a request by mail to your lessor. This will help you save some money.
Evaluate the possibilities of reducing your taxes
We do not always take advantage of all the tax cuts to which we are entitled. However, certain specific, social and general deductions can allow you to reduce your taxes and thus save on your budget. Do not hesitate to use the different online simulators to find out which deductions you are eligible for.
Find the best prices by making comparisons
Buying from the first salesperson you meet is not the best habit. If you really want to reduce your expenses, you need to take the time to find the best prices with every purchase. To do this, it is necessary to compare the prices applied by several sellers. The Internet is a very practical virtual showcase for making this price comparison. If you have time, you can also compare them directly from the stores. This concerns small daily purchases, but also large purchases. Every franc saved is important. At the end of the year, you will have accumulated several thousand francs in savings.
Rreduce transport costs
Constantly traveling by car is not very ecological. This means of transport is also not the most economical. The cost of fuel is not the only expense it entails. You must also take into account the insurance and maintenance costs and the monthly payments if you have not yet repaid your car loan. If possible, take public transport. You can also apply driving habits which can reduce fuel consumption. The savings to be made can be substantial in the long run. If you are planning to buy a car, choose a model whose consumption translates into real savings on your monthly or annual fuel budget. Also, negotiate your auto loan to take advantage of low interest rates. You can also redeem this one using Lica services. Alternative means of transport should not be neglected. They are environmentally friendly and can be cost effective.
Reduce the cost of your insurance
Certain insurances are compulsory in Switzerland. This is the case for health insurance and liability insurance for your vehicle. Depending on your status or your profession, you must also take out certain insurance. All this constitutes sometimes significant expenses in monthly contribution. Review your insurance contracts. You can cancel certain guarantees which cost you several thousand francs per year and which, however, are neither obligatory nor exploited. If you therefore want to reduce your insurance expenses drastically, keep only the basic guarantees on each contract and appeal to the services of a professional.
Adapt your finances
You can adapt your finances to your new habits. You will earn a few francs by using a more affordable bank card that is more suitable for your purchases. Also find an advantageous bank account in terms of account and transaction fees and interest, if any. Also study the provident schemes that are more advantageous in terms of contributions. Saving is an investment item that you should pay special attention to. Choose their investments carefully so that they earn higher interest.
Reduce telecommunications costs
Telecommunications are essential in our daily life. Internet, television, fixed and mobile telephone lines make our life much easier. Telecommunications is an expense item to be carefully studied. Indeed, you can reduce your expenses and make good savings on this one item. This is possible thanks to the large number of offers offered by the various market operators. Once again, the comparison is in order. Cable subscription may be more affordable with a competitor. The same is true for your telephone package and for your pay TV channel package. Opt for offers that present limited costs for satisfactory services.
In conclusion to reduce expenses
Cutting back on spending doesn't have to have a big impact on your lifestyle. It is possible to keep a large majority of your daily privileges while reducing fees and costs. It is enough to know how to optimize your budget and to show ingenuity. Thus, you will feel less of the impacts of the crisis! Regarding your private credit, you should also think about buying it back if your rate is higher than 4.5%. With Lica you benefit from an answer within 24 hours and from an easy acceptance. Once your funding has been accepted, Lica will give you an additional cashback of up to CHF 5,000. Make your request without obligation!