Cutting back

At a time when there is a global credit crunch, and essential everyday items like food, general shopping and going out are increasing in price, it is very tempting to try and reduce all areas of 'non-essential' expenditure. Recent research has shown that while hard pressed families are willing to cut back on those weekend breaks away, and stick to supermarket own brands, they are still keen to have that annual holiday in the sun. It seems that as a nation our sentiment is 'the show goes on'.

In order to afford the big annual holiday, we will have cut back as explained above, on items of 'non essential' expenditure. One our biggest outgoings will be the monthly mortgage repayment, and if we have shopped around to find a better deal, we can make significant long-term savings. With so many fixed rate deals coming to an end, many people are in the market for a new competitively priced mortgage. Apart from Council Tax, which sadly we cannot do anything about, the other major outgoing is likely to be home insurance.

We may want to reduce this to the absolute minimum required by our mortgage provider, and typically this will be some form of buildings insurance. However taking a longer term approach, we should think carefully about whether this is actually wise. The first thing to do is consider what we stand to lose should the worst case scenario hit – i.e. our house gets broken into and precious household goods are stolen. It would probably cost far more to replace them than it costs to keep on the contents insurance policy. The second and more important thing to realise is that it is a very competitive market out there, and it has never been easier to switch home insurance providers. Shopping around certainly pays off, and a good place to start is the Co-Operative Insurance website. This will explain all the options available to you, in plain English, and at affordable rates.

As with all insurance policies, you should read the small print carefully to see what you are covered for, but at a time when you may be tempted to reduce your level of cover with your existing provider it may be far better – and cheaper – to switch to a new one.

For a comprehensive home insurance quote try the Co-Operative.