This content applies to England only.

Housing laws vary between England and Scotland. Get advice relating to Scotland

If there are changes in your circumstances, such as redundancy, short-time working, illness, caring for another person or having a child, you may have to cope with a reduction in income and may have to reduce your costs. Take a look at our cost reducing ideas.

You should also consider if there are ways of increasing your income. If you have or are expecting kids, think about ways of budgeting for them. 

Cut your housing costs

Rent

• If you haven't already claimed, check if you are entitled to housing benefit.
• If you are renting privately and cuts to housing benefit mean the gap between your rent and income is too big, you may need to consider a move to a different property or area. Check the Local Housing Allowance website for details of maximum rents in different areas.
• If a move really isn’t an option, see if you can claim discretionary housing benefit. This may provide a short-term solution, allowing you time to explore other options.

Mortgage

• If you are not tied into a mortgage, see if you can shop around for a better deal. It is a good idea to do this before a big change in your circumstances  – do it before your maternity leave or redundancy if the loss of income will limit the choices you have.
• If you have money left over at the end of the month, consider if you would benefit from overpaying on your mortgage. You may be able to reduce the amount you pay in interest as a result – but check there is no penalty to pay if you do this. Try mortgage overpayment calculators from Motley Fool and Money Saving Expert .
• If you are have rent or mortage arrears, see if you can negotiate a solution.

Endowment Policies

• Many endowments are unlikely to pay out the full amount of the loans they were intended to cover. You should be kept informed on how your endowment is performing – if it is likely that your policy won’t pay off your mortgage, you will need to get advice.
• Suspending payments, selling or surrendering your endowment and changing to a repayment mortgage may be options you could consider to reduce your outgoings, but these are major financial decisions requiring expert independent financial advice and the consent of your lender.
• Endowment policies also provide life insurance – you may need to consider the cost of replacement life cover if you are thinking of ending your policy.

Buildings and contents insurance

• If you own your home, you will normally have buildings insurance which helps with rebuilding costs if your home is damaged by fire, floods or subsidence. It’s important to have this type of insurance – your lender may insist upon it and you will still have to pay your mortgage even if your house burns down – but you can shop around for cheaper deals.
• Use moneysaving websites or online searches to help find cheaper deals.
• You may be able to reduce your costs by agreeing to a larger excess – the amount you pay if the insurer has to pay out on a claim.
• If you have a leasehold property, your freeholder may have arranged buildings insurance for the whole building as part of your service charges – check what cover is provided.

Service charges and ground rent

• As a leaseholder, your service charges and ground rent are essential housing costs – if you don’t pay them, your freeholder could take action to repossess your home. 
• Find out what action you can take to challenge unreasonable service charges.

Cut your priority living costs

Council tax

• Consider claiming council tax benefit.
• If you live on your own, check that your council tax has been reduced  – single people are entitled to a 25% reduction.
• Make sure the council knows if you are an all-student household – provided you fill in the forms and provide evidence of your student status, you shouldn’t have to pay!
• If your home is empty, or solely occupied by people aged under 18, or you are severely mentally impaired, check if you are exempt from paying council tax.

Fuel bills and energy costs

• Shop around for deals – fuel is supplied by companies operating in competition with each other – you can choose to switch your supplier. Use the price comparison tool from Consumer Focus. You may also want to compare results from price comparison websites such as: lovemoney.com, WhichSwitch, Energy Helpline, Simply Switch, and Moneysupermarket.com.
• Energy suppliers offer social tariffs with reduced rates for vulnerable or disadvantaged customers. They may be a useful option if you are over the age of 60 or claiming means-tested benefits.
• Look at lovemoney’s top tips on reducing your energy costs.
• Use our Shelter action planner Cancel it, Review it, Swap it to help you.

TV Licence

• Most people need a TV licence to use a television, but there are some exceptions. You don’t have to pay if a member of your household is aged over 75, people who are blind or severely sight impaired can get a 50% reduction and students can ask for a refund during the summer holiday period.
• If you have difficulty paying, you can choose to pay by instalments.

Water bills

• There are two ways you can pay for water – either through water rates, or using a water meter. Using a water meter may be cheaper if you are a small household and don’t use much water. Once you have a water meter installed, you can’t change back to paying water rates. More information is available from Ofwat.
  
• You can usually pay for water rates in instalments – contact your water company for details.
• If your metered water bills seem very high, check that there are no leaks on your system.
• A Watersure scheme may provide help with water arrears for vulnerable people, capping metered water bills.

Reduce your everyday living costs

Events

• Do you know what you spend on birthdays, Christmas, holidays and other celebratory events?
• Get help online from money saving websites for ideas on how to reduce these costs.

Food bills

• Consider if shopping online will help you budget your food bill or find the cheapest deals in the supermarkets – compare costs using sites such as My Supermarket.
• Search out cheaper supermarkets and look to see what markets have to offer.
• Try supermarket own-brand foods.
• Buy only what you need – make a shopping list.
• Don't buy expensive ready meals: cook instead – find tips on websites such as BBC Food  and Frugal living in the UK.

Health

• Can you register with an NHS dentist instead of paying privately?
• Check if you are eligible for free prescriptions, dental treatment, sight tests and help towards the cost of glasses.

Insurance

• Shop around for your essential insurance cover and look for cheaper alternatives. Use our Shelter action planner Cancel it, Review it, Swap it to help you.
• Regularly review your policies to check they provide the cover you need for your circumstances.
• Don’t pay twice. If you are paying for contents and buildings insurance separately, check that you are not doubling up on extras like legal cover. Don’t take out separate policies for appliance breakdowns if you are already covered on your contents policy.

Leisure

• If you are not using it, cancel it. Cancel gym memberships and anything else leisure-related that you can’t afford and don’t use. Check if your local authority sport centre has cheaper pay-as-you-go memberships.
  

Pension contributions

• There may be times when you need to reduce or suspend payments into a personal pension. Make sure you understand the terms and conditions attached to your pension(s) and seek independent financial advice before making any major financial decisions such as this.

Phones and TV packages

• This is an ever-changing area, with different companies competing for business. Check that you need and are using the features of your existing package. Shop around for the best deals and avoid getting tied into deals for extended periods if you think your circumstances might change.

Transport and travel

• Explore the cost of public transport locally – can you get season tickets or reduced price tickets to reduce your overall costs?
• Work out the true cost of your car. Shop around for the best deals in insurance, fuel and running costs – take a look at Moneysaving expert’s cheaper fuel tips.
• Look at individual journey costs – a cheap train ticket may be less expensive than the petrol costs for your journey.
• Can’t afford to run a car? Look at other options – public transport, cycling, car sharing with friends, car sharing clubs, or car hire.

Negotiate your costs down

• If faced with a change in your circumstances, a phone-call to cancel services will often produce an offer of a reduced price service.
• If you shop around for cheaper alternative services, you may find your existing supplier will match a rival’s deal, saving you the hassle of switching.

Find money saving ideas online

There is no shortage of online money-saving help – just be sure to check that you are using guides dedicated to saving you money rather than financial sites offering a quick fix that could cost you more:

• Use online money saving vouchers, discounts, and promotion codes. 
• Would shopping online help you budget your food bill or find the cheapest deals in the supermarkets?

Think the unthinkable

Everybody’s circumstances are different, but sometimes a change in circumstances means you may have to radically rethink your lifestyle for a while:

• Can you holiday at home? 
• Do you need to run a car?
• Can you ask your grown-up son or daughter to share more of the running costs of the home if they are living with you?
• Would cutting down or giving up a regular cost mean that you have more money for other things you’d rather do?

Still can’t make ends meet?

Useful information can also be found on websites run by debt charities such as CCCS, National Debtline and Debt Advice Foundation. You may also find useful advice and tips on websites such as moneysaving expert.com and lovemoney.com. 

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