Beating the Credit Crunch

Despite the fact that the country is now out of recession, many people continue to feel the bite of the credit crunch. Job prospects are bleak, the threat of unemployment hangs heavy, and prices are rising rapidly.

However, the continuing credit crisis need not hurt as badly as you might think. In reality, the hardship it will cause is directly related to the amount of debt you are already in; as credit becomes more expensive, those who are already having some difficulty getting by are likely to find that this difficulty increases over time. There are, however, a huge number of savings to be made on everyday items; with a bit of forethought and very little work it is possible to cut your outgoings significantly.

High Street Savings

The areas in which you can make price savings are as many and varied as the variety of things on which you spend money. There are literally thousands of discounts available from high street retailers, particularly on the Internet - you just need to know where to look. The majority of retailers have cottoned on to the effect of the credit crisis on consumers, and are adjusting their prices or offering deals and savings to accommodate people's lower spending power. A good first step would be to sign up to one of the many free mailing lists that provide regular updates on vouchers and cash-back deals; making use of these 'affiliate' programmes can help to minimise the effect of the current credit situation on your own personal finances.Many consumer advice sites have negotiated deals with retailers to offer lower prices to readers, and there is no reason why you cannot take advantage of these.

Aside from this, there are obvious savings to be made by giving a little extra thought to things like your weekly shop. You might consider planning your week's meals in advance, and sticking rigidly to your ingredient list when you visit the supermarket. All of the 'budget' supermarkets are offering a wide range of special offers on staple products, aimed at helping consumers to beat the credit crunch. Aside from this you should also time your supermarket trips carefully; find out when your local store begins their daily reductions, and visit accordingly where possible.

Reduce your Borrowing

From a financial standpoint, consumers' ability to make savings on their existing credit arrangements has been reduced as banks become more reticent to offer deals. Gone are the days of moving your credit card balance from one 0% deal to another, at least for the time being. That said, there are still ways in which you can make credit cheaper. In the first instance, you should remember that you are almost certainly earning less in interest on your savings than you are spending on your debts. As such, you should look at using any savings to pay off money that you owe, and thereby reduce your debt. This will lower your repayments and put you in a better financial position in the short term.

While the outlook may appear bleak, it is also important to remember that the credit crisis will not last forever. There is no need to panic; look at ways in which you can make short term savings while you weather the storm, and you should be on the road to financial recovery relatively soon.