It’s no wonder so many of us are worried about the rising cost of living. With essentials like food and heating costing us more, of course it makes sense to think about cutting back. It can be stressful, having to decide what is and is not an essential cost. But as hard as times are, you are not alone in these struggles – and there are plenty of ways to spend less, while still proudly putting your loved ones first. We’re here to help, with a couple of simple tips that could make all the difference.
Why is the cost of living increasing?
Even before the pandemic, you may have noticed that the pound doesn’t stretch quite as far as it did 10, 20, or 30 years ago. It wasn’t so long ago that a bag of pick n’ mix cost just a few pennies, and you could buy a brand-new book for less than a fiver! Inflation is a part of modern life - it’s become normal for prices to rise over time, but we don’t normally see it happen this quickly. A few things led to the soaring rates of inflation that we’re seeing today, but in short, it’s down to energy prices. With life returning to normal as we learn to live with covid, there’s been more demand for oil and gas. These all-important resources are in short supply due to the war in Ukraine, and this is driving energy prices up, which is creating a knock-on effect for other costs. Simply put, all of this means that people across the UK are suddenly finding it more and more expensive just to live our day to day lives.
How does my life insurance help?
According to a poll by Scottish Friendly, 63% of over 50s with life insurance are already thinking about the importance of their plan in the coming years. With inflation hitting every part of our economy, your life cover could be more important than ever. If the worst were to happen, your benefit amount could make a huge difference to your loved ones when it comes to funeral expenses or any outstanding debts you might have. By getting life cover, you’ve already taken an important step to protect your family from financial pressure, and that’s something to be proud of. Now, going the extra mile to keep your policy in place could protect them against added stress at a very uncertain (and expensive) time in our history.
From our 2023 Funeral Report, we’ve learned that funeral costs are rising year on year. This means that any financial support you can leave in place for your loved ones could take some of the pressure off.
It’s also worth noting that you’ll save money in the long run by protecting your family now rather than later. The price you pay for life insurance today is partly based on your age at the time you purchased your policy. So, if you were to take out the same policy in a few years' time, you would end up spending more per month for the same cover. Not only have you made a choice that will save you more than a few pennies down the line, but you’ve secured valuable cover that could protect your loved ones for years to come.
At the end of the day, while experts have different opinions on when this crisis will end, they seem to agree on one thing – it will end. So, when all is said and done, you can feel proud knowing you’re protecting the people you love beyond the current financial crisis.
What else can I do to save money?
As difficult as it may seem, there are still a few ways you can cut back your spending. With so many of us in the same boat, financial blogs and websites are full of tips and tricks for saving money. Here’s our round up of some of the simplest advice:
Energy costs
When it comes to saving money, much of the advice at the moment sets energy bills high on the list of things to consider. The cost of gas and electricity for most households is almost double what it was last year, so it makes sense to use your energy more efficiently.
This should be easier as we come into Spring, but it’s not too early to start planning for the Winter ahead, or any cold snaps we might see before then. This is Britain after all!
Start by doing what you can with lots of layers to keep warm, so you can comfortably turn your heating down to a lower setting. Even just 1 degree lower could help you save up to £80 a year, and this should be an easy way to make a small difference to your bill. You can also try using draft excluders for doors and chimneys, so you’re not losing the heat you pay for through small gaps and crevices in your home.
You can also make small changes to save on electricity costs. This could be as simple as making an effort to turn off lights in empty rooms. According to the Energy Savings Trust, unplugging or turning off your electronics at the mains could save up to £65 a year, as many of these devices will still use power in standby mode. You can find more of their energy saving tips here.
Household bills
Aside from shrinking your energy bills, this could be a good time to look at the other household expenses that might be costing you more than they need to. You can try shopping around for the best phone and broadband bills using a comparison tool like Which?, or even give haggling a try – according to MoneySavingExpert, plenty of people have saved hundreds by negotiating a better deal. You can read through their haggling tips here.
According to Barclays, British households are spending around £500 a year on subscription services. So, if you use streaming services like Netflix or Amazon to watch movies and TV, this might be the time to do a cull of your subscriptions. You could always alternate streaming services to save money, and sometimes you’ll even be offered a better deal if you try to cancel a service.
Food and groceries
If your spending is spiralling out of control, the easiest solution is to make sure you’re getting the best value. Which? publish a monthly comparison of the most popular grocery shops and highlight the shop that currently has the lowest prices. As of December 2022, Aldi has come out on top with the best value for seven months straight, with Lidl and Tesco not too far behind.
You can also make sure you’re ticking all the usual boxes for saving money on food and groceries:
- Are you choosing shop-owned labels instead of brand names?
- Have you signed up for clubcards and loyalty schemes?
- Are you using vouchers when they’re available?
- Are you taking advantage of deals to stock up on shelf-stable items you usually buy?
What else can I do?
If you’re worried about money, there are places you can turn to for support.
- You can visit the Gov.uk website to find out what Cost of Living payments you might be receiving in the coming months.
- Age UK have a free Information & Advice phone line for help with a range of issues including financial help, as well as a chat function on their website. Their advisors could help you find out if you could be eligible for benefits you’re not receiving.
As always, we're here to help. If you’re worried about paying your premiums, or you want to apply to make changes to your policy, call our UK based customer service team for free. We’ll be happy to talk you through your options. You can reach us on 0800 542 7618, Monday to Friday from 9am-7pm (excluding bank holidays).