UK inflation has risen to its highest level since March, driven by an increase in petrol prices last month, according to official figures. The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation rose to 2.6 per cent in November, from 2.3 per cent the previous month.
The rate of CPI inflation for food and non-alcoholic drinks, alcohol and tobacco, clothing and footwear, recreation and culture all edged higher over the year to November, compared with the year to October. These new figures are important for everyone spending money over the festive season as it means the cost of living crisis will continue to eat away at household budgets into the new year.
On top of the rise in inflation, energy bills are also set to increase slightly from New Year’s Day. Households on the standard tariff, with typical average usage, will rise from £1,717 to £1,738 from January 1 – an increase of £21 over the coming year (£1.75 per month).
However, if you’re concerned about keeping on top of your bills and keen to start reducing your outgoing costs and make some savings before the new year, there are a few ways to ease the squeeze.
While the savings – if you can do all 10 of these cost-cutting tips – could be huge, the reality is that you only need to achieve one or two things on the list below to start making an improvement to your personal finances.
10 ways to cut costs and save money this winter
1. Make small changes to your routine
Simple ways to save money start at home. By taking a short shower instead of a bath, you could potentially use around 70 fewer litres of water each time, according to Smart Energy GB.
Washing clothes at 30 degrees could also save on electricity and turning off standby appliances before going to work, at night and when generally not in use could help.
2. Make sure your boiler is efficient
Having a boiler serviced will help to minimise energy bills by helping it to run more efficiently and reducing the risk of a future breakdown, according to gas registration body the Gas Safe Register.
Although money may be tight, it’s vital to make sure gas appliances are safe. Warning signs include lazy yellow flames, pilot lights that keep going out, black marks or stains on or around gas appliances and increased condensation inside windows, according to the Gas Safe Register.
3. Check out grants and benefits
Some people could be entitled to financial support during the colder months including:
- Winter Fuel Payments (up to £300) – for pensioners on means-tested benefits
- £58.75 Winter Heating Payments – for low income Scottish households
- £251.50 Child Winter Heating Payment – young people under 19 on higher rate disability benefits
- £150 Warm Home Discount – for those on a low income on certain benefits
- £25 Cold Weather Payment (not Scotland) – £25 for every 7-day period of freezing temperatures
4. What other bills could you cut?
Take stock during the festive fortnight to look at all your outgoings and make sure you’re paying for products and services you actually use. If you have multiple streaming subscriptions, make sure you’re getting value for your money and ditch the ones you rarely watch.
5. Cut commuting costs
Whether you’re hybrid working or full-time in the office, look out for seasonal deals on travel cards. It might be worth investing in travel discount cards, which can knock a third of train tickets.
6. Save on food
Taking a shopping list with you to keep you focused, and visiting your local supermarket at a time of day when it is making reductions could help keep bills down.
This time of year means there are bags of bargains to be found in supermarkets as most overstock on seasonal items to avoid running out. The price of veg has also been slashed to as little as 10p, so stock up and make the most of these – proper storage can see them last long after Christmas.
7. Could you be on a cheaper mortgage deal?
For many people, their mortgage is their biggest regular expense. Even for some people who think they would have difficulty switching, it may be worth checking.
The Intermediary Mortgage Lenders Association (IMLA), says many providers will lend to applicants with ‘non-standard’ financial circumstances.
The IMLA’s research among mortgage providers found 88% would accept applications from self-employed borrowers and 71% would consider borrowers with irregular incomes.
Recognising the disruption caused by the coronavirus pandemic, 16% of lenders have reduced the periods for which self-employed borrowers need to show earnings records.
8. Sort your savings
If you do have any leftover cash, make sure it’s earning some interest. If it’s not earning at least 5 per cent right now, move it to a better deal. Use a comparison website to find the one that fits your savings needs.
9. Take your time when Christmas shopping
With just a week to go until the Big Day, and a lot of people set to receive their December pay early, resist the urge to splurge and panic buy last minute gifts for family, friends, neighbours or colleagues.
An early pay in December means a longer wait until the next one in January, so keep an eye on your outgoings.
10. Book Christmas train travel tickets in advance to make savings
Trainline says booking your ticket in advance this Christmas could save you 61 per cent on the fare. Book early to get the best deal.