5 budget improvements that will stretch your emergency savings

Finding yourself in a tight spot financially can be panic-inducing. Careful planning and changing a few of your habits can help you stretch your emergency savings.

This guide will point out areas in your budget that may with a bit of work and help you keep your funds working hard for you for as long as possible.

#1 Get better rates on your mortgage or hunt for a cheaper rental.

As a homeowner, you have more options when it comes to decreasing your expenses. Refinancing your mortgage allows you to renegotiate the terms and fees on your home loan. You have two primary options when it comes to refinancing.

Refinancing option 1: Negotiate with your lender

Contact the bank or lender who holds your mortgage and ask them to set up a refinancing deal. You can choose to refinance your loan on the outstanding loan amount, which will already decrease your monthly repayments. You can extend the loan term. You'll pay more in fees over a longer period of time but, your monthly instalments will be lower. Depending on what the interest rate was when you originally signed your loan agreement, you may even be offered a lower interest rate when you refinance.

Refinancing option 2: Switch to a new lender

Alternatively, you can go online and consider the offerings of different banks and lenders. Compare interest rates, terms and features offered and see how their service is rated by customers. Other lenders may have more cost-effective refinancing deals to offer you. In your current situation, it's best not to refinance your loan for more than the outstanding amount.

Borrowing more than you need means more expensive repayment rates. You should to take your original loan contract into account; it may state that there will be a penalty fee for switching to another lender. Find out what it will cost you before deciding whether it's worth signing on with a new service provider.

Find a cheaper rental

Unless you own your home outright, rent is an unavoidable part of life. When it comes time to tighten the budget, you can make a few changes that may bring down this expense. Use social media, and online rental agencies, or contact an estate agent to help you find a cheaper rental property.

Three things to take into account before you make a move:

• The terms of your rental contract and whether you'll have to pay any penalty fees for ending it early.
• The location of the new rental. If you'll pay more in fuel costs than you paid for rent.
• The safety of the area and how secure the property is.

#2 Refine the food and household items budget

With a meal plan in hand, preparing your meals ahead of time becomes an easy way to save time and money. Cook large quantities of rice, stew, meat roasts etc. and freeze them in meal-sized portions. Nothing has to go to waste and what you can't freeze can be whipped up quickly before serving the meal.

Say no to take-aways and eating out

Instead of buying takeaways, make your own food at home. Rolls, pizza bases, burger patties and so much more can be premade and frozen. You'll have a healthy and cost-effective alternative to fast food.

Meal plan and use a shopping list

Set aside one day a week to do your grocery shopping. Start a shopping list using your meal plan. Having a shopping list can help you avoid impulse buying and eliminates the chance you'll forget something and have to make a second trip. Take advantage of discount items, coupons, and stores that offer the same quality at better prices.

Buy bulk to save big

Bulk-buying toiletries, food, and all sorts of household items can save you a lot of money in the long run. The rule about buying in bulk is that you only buy products you know you use a lot of. Being careful to keep delivery costs in mind, you could find buying in bulk online a great way to save. Toilet paper, cleaning products, and canned foods are good items to buy in bulk. When buying food in bulk, you must always check the expiry date.

#3 Fuel conservation and saving money on utility bills

Cutting down on your fuel consumption means changing a few of your habits. Carpooling to work, school, and to shops will already make a big difference. Keep up with your car's services; well-maintained cars don't waste fuel. Your car's air conditioner uses a lot of fuel, so if you have a choice, crack a window instead. Arrange your errands for the same day as you do your weekly shopping and avoid high-traffic areas.

Compare options and switch providers

The first step to streamlining your utility bills is to take a look at your options in terms of service providers. Using the Power Switch site, you can compare the deals offered by several service providers. Choose the company that offers you the best service at reasonable rates.

Be mindful of your energy consumption 

Then it's time to take a very hard look at your energy consumption. Mindfully limiting your electricity and gas usage may take effort to start with, but will become second nature over time. Using LED light bulbs, switching off computer monitors when they aren't in use and using your washing line or clotheshorse instead of the dryer will make a noticeable difference.

#4 Squash loans, contracts, and other unnecessary expenses

If you have multiple outstanding personal loans, it's time to consolidate them. It may sound counterproductive to take another loan right now, but there is a method to the madness. By taking a loan to pay off the other outstanding loans, you are cutting down on the interest rates and fees you have been paying on each loan. If possible, use this loan to clean your credit card debts and close the accounts. You may need to include early payment penalty fees in your loan amount.

If for whatever reason you are unable to get a consolidation loan, there are other options. Pay only the minimum required on your debts. You could also contact your lenders and chat with them about alternative payment terms. Most lenders will have a solution that you can afford and are genuinely willing to help.

Cancel contracts and switch providers

Having more than one internet or cell phone contract is an unnecessary drain on your finances. It may not be feasible until the contract comes to an end, but once it does it may also benefit you to cancel unnecessary contracts and switch to a service provider who offers you a better and cheaper deal.

Check your bank statement and make sure you aren't paying subscription fees for services you don't use. Cancel any subscriptions you haven't used in the last few months and decide if the rest are truly worth keeping. And if you haven't used your gym membership lately, it also needs to go. During this leg of your financial journey, the best way to survive is to cut down on any expense that is not vital to your daily life.

#5 Put entertainment, vacation plans, and luxury items on the back burner.

To stretch your emergency savings as far as possible, you'll need to cut your entertainment budget right down. Going to the movies, spending the night in a pub, or going out for dinner are all off the table. Fortunately, there is an unlimited number of enjoyable activities that will cost you next to nothing.

Unfortunately, your dreams of taking a weekend away with your spouse or friends are off the table for now too. Your situation won't last forever, make plans for an undefined future date. That way you'll have it all mapped out when your finances have been sorted out.

No matter how you ended up in a tight financial situation, there will always be some way out. Using the luxury items you love as a reward for getting through the situation is a good motivation. Set up a wish list and add to it as you go. Living under financial constraints is never easy, so keep your eyes on the horizon.