How you save depends on how you live

You might have tried switching your utility provider and cutting back on luxuries, but sometimes something more dramatic is needed to make an improvement to your finances.

Mum and dad's house

If you're still living with your parents, moving home is probably something you think about a lot! Having said that, living with your parents temporarily is a good idea financially, as it's likely to be much cheaper than renting, or paying your own mortgage. According to the Office for National Statistics, in 2009, shortly after the economic crisis began, a third of men and a fifth of women aged between 20 and 34 were living at home with their parents.

So living with your parents might be an affordable option, but it's not one that's available to everybody - perhaps because of their location, or because they just don't get along. So what are the other options?

Renting

If you're going to rent, living in shared accommodation is one of the most affordable ways to live, because not only do you share the cost of rent: you also share the cost of bills.

Some shared accommodations come with bills included, making it simpler to manage your money. However, if your name isn't on the bills for where you live, you could be missing out on the opportunity to build up your credit rating. Read more here about how to improve your credit score.

Homeownership

Mortgages are now on average cheaper than renting, so buying a house can save you a lot of money in the long term. In general, the larger your deposit, the cheaper your mortgage.

To try our quick and easy mortgage calculator, click here.

If you own your own home and want to make a dramatic difference to your finances, you could downsize your home or move to a cheaper area. This is only an option if you can find a buyer for your home and the cost of changing address wouldn't outweigh any savings you could make.

A simpler option for homeowners can be to take in a lodger if you have a spare room. This can bring in some extra cash, and it doesn't need to be a permanent arrangement. Just check that you're paying the correct tax. The Rent a Room Scheme, for example, allows homeowners to take in a lodger and receive up to £4,250 per year tax-free for a furnished room in their home: follow the link to find out if this might be an option for you.

If you are a parent of one of those adult children living at home, consider asking them to pay for their accommodation / food / bills. Some parents wouldn't dream of doing this, but if your child's making money, it makes financial sense for them to contribute to the household.

If you really couldn't face asking your child for money to live in your home, you could make sure they contribute in other ways. Babysitting, providing lifts, gardening - if it's handled right, anything that saves you time and/or money can be as good as an actual cash contribution.

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Tags: debt, property, living costs, bills, mortgage, ONS, Office for National Statistics, rent

How you save depends on how you live

Mum and dad's house

Renting

Homeownership

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