House Finances 101
If you're about to move alone and you've never run your own house finances before, you should take some time to actualy see what your domestic costs will be, and devise a strategy to face them so you make sure you can cover your bills every month. Paying for things at your own house can be quite challenging if you're not used to. If you are a first timer at living alone or in a couple, chances are your income isn't still at its highest. Paying for bills and covering your expenses is likely to be somewhat challenging to you. This doesn't mean you won't be able to manage your home finances, but it definitely implies that you have to give it some thought and some planning.
Cost calculations should be a main part of the process of decision-making from the very beginning. Where are you going to live? Are you going to buy or rent? What area will you choose? What type of building? What will your life standards be? Can you do with them?
Running home finances could fall into your hands in case you become the head of the house you're already living in. For example, with the previous home administrator passing away or moving. In this case, the point is not about choosing a home you can afford, but making sure your finances are well managed and checking the possibility of getting the same things for a lesser price. Let's review a couple of these ideas.
Bills and extra expenses
You have to mind two different sorts of expenses when you calculate how much money you need a month. Also, remember the rule of thumb that you should be able to save at least 10% of your income for unexpected expenses or future investments.
First of all, you have fixed expenses. These will include bills like energy, gas, mortgage instalments, telephones and an Internet connection. These bills should be paid every one or two months depending on your supplier. You need to calculate how much these expenses will be and make sure you have money every month to cover them.
One of the most common mistakes for first timers is to underestimate extra expenses. The fact that you earn enough money to pay your bills is far from being enough for you to move alone or run a house. You will have extra expenses all the time. Small ones like clothes, going out to eat, entertainment, social life and gifts, and big ones like vacations or special purchases - think of a car, a new mobile phone, and so on. You have to calculate a budget for these extra expenses.
So your income should be divided in fix expenses, variable expenses and a margin for saving and unexpected expenses.
If you want to manage your home expenses efficiently, saving money is always a good option to consider. You might be able to get exactly what you have for less money. Also, you could cut down some expenses on things you don't really need that much but might be affecting your monthly balance.
It's always a good idea to start by calculating how much money you get and how much you pay, and divide it by categories. This way you will get an outlook on your home finances and your money flow. Use this Household budget calculator and type in all sources of money you have and all expenses you calculate per month. This tool will show you your balance as well as the percentage of expenses each category has. This is very useful if you want to cut down costs.
Saving on energy bills is a good option, and in most cases it's easier than people think. You can cut down the usage of certain appliances that consume too much electricity. The UK Power website is great for calculating how much energy and money each machine or appliance consumes.
Also, switching energy suppliers is an option few people consider, but could actually save them a lot. Use the U Switch website to compare price rates and relevant service features of all energy suppliers on your range. This site will help you make the comparison and even switch from one company to another if that is what you wish. You can also call your energy supplier and ask for a discount or special plan, for example if you are an EON client you can call the EON Number and request an offer, especially if you have already identified another supplier that seems more convenient for you at the time.