Get more bang from a better budget

IF YOUR pay packet doesn’t seem to stretch as far these days, you’re not imagining things.

Wages are growing by a record low of just 1.9% annually and with inflation also running at 1.9%, the purchasing power of your pay cheque may not have increased at all.

At times like these it’s important to make your money stretch further.

Right now, household incomes are flat-lining and making every dollar work hard is essential.

In the current environment, reviewing your household budget is a must-do.

Yes, I know my mantra is “budget, budget, budget”, but it’s a great way to ensure you are living within your means rather than relying on debt to maintain your lifestyle.

It’s also important to shop around for major expenses.

When your car or home and contents cover is due, for instance, don’t just pay the premium.

Take a look and see if you

Household incomes are flat-lining and making every dollar work hard is essential.

could do better elsewhere. A colleague of mine recently knocked $200 off her annual car insurance premium just by switching to a more affordable insurer.

Power bills are one area where many of us are feeling the financial heat. According to Finder, 1.4 million households often struggle to pay their energy bills. Switching energy providers can provide savings.

I realise the sheer volume of comparison sites such as GoSwitch or Energy Made Easy does not always make it easy to know which provider offers the best deal.

However, by looking back over previous power bills you should be able to form a reasonable picture of your usage patterns.

Use this to narrow down the plan best suited to your needs and budget.

Don’t overlook financial products.

Fortunately, low wage growth is coinciding with historically low home loan interest rates. But credit card rates can still exceed 20% and on the average card debt of $3100 you could be paying interest of more than $600 annually. Yet this cost can potentially be halved by switching to a lower rate card.

In today’s environment of low wage growth it can pay to be careful about taking on more debt.

A rise in interest rates could leave you financially skewered.

Paying with cash where possible has far less impact on our financial wellbeing, especially when it’s part of a sensible budget.