SAVING MONEY TIPS
15 Saving Money Tips
Saving money is often considered to be a boring subject, and something to be done by the older generation, but with the cost of living rising quickly in the UK, USA and all around the world, saving money should now be on everyone’s mind, both young and old,
Therefore, in this 15 saving money tips article, we will provide you with a step-by-step guide on how to save money, so that you can manage the current squeeze on household budgets caused by high inflation.
As is often the way, the biggest hurdle can be just getting started, so you need to take the bull by the horns, accept you need to cut down on those coffees and eating out, and get going! Once you start, you may even find it good fun to conserve cash for something special.
So, now its time to boost your savings with our top 15 saving money tips.
1. Record your expenses
Before we can target how best to start saving money, we need to work out how much you spend currently. Therefore, either keep a record of all your expenses for a full month, including every coffee, cake and take away, or take a look at your historic bank statements if you only buy with cards.
Once you have collected your results, separate them between key categories such as essentials, rent, rates, mortgage, utility bills, food etc, and non-essentials such as coffee, eating out, entertaining, cinema etc. Make sure to include everything.
You can now see exactly where you are with your monthly spending, and how much potential money can be saved.
Handy Tip: You can now keep track of your spending using free budget Apps that link to all your back accounts to make the process much easier.
2. Set a savings budget
Now you know exactly how much you spend each month, you can set a savings plan up so that you take out some money to save each and every month, before you get the opportunity to spend it on non-essentials.
For example, if you now know that you spend £500 per month on essentials, and have £500 left over from your income for non-essentials, then saving 10% of that (£50) should not be too painful.
Handy Tip: Always save before you spend, as if you try and save what’s left over each month, there won’t be any!
3. Set a savings goal
Now that you have set up a monthly savings plan, try and go one step further by setting a savings goal. This could be for anything, and will help keep you going when these money saving tips are beginning to bite.
For example, it may be as simple as saving an emergency cash fund of 3 – 6 months expenditure to help cushion the loss of a job. Or it could be something more exciting like saving for a holiday, or new car deposit or a down payment on a house. Whatever it is, keep the big picture in mind as you walk past Costa coffee and ignore its lure.
Handy Tip: Be sure to set achievable goals, as its much more motivating to hit them, than miss out on unrealistic ones.
4. Cut your existing essential costs
There are many monthly expenses for essential items that are unavoidable, but that doesn’t mean you can’t save money on them. List out your essential costs from most to least expensive, and then tackle them one by one to ensure you are getting the very best deal on the market.
Mortgage costs are often the highest expense each month, and so by shaving a per cent or so from your mortgage rate by re-mortgaging could save hundreds or even thousands per year.
The same applies to house and car insurance, broadband, phones, electricity and gas and so on, use price comparison websites to ensure you have the very best deals, as most people are paying more than they need to be as they simply don’t shop around or switch providers.
5. Cut back on non-essential recurring costs
Examine your monthly bank statements in fine detail and try to identify any recurring monthly fees that you could cancel. For example, are you still going to the gym you signed up to in January, or do you pay £75 per month for nothing? Do you really need a dozen bottles of selected wines from around the world delivered to your door each month? Same applies to Netflix, Now TV, Apple TV, Sky and Amazon TV, do you really need them all? you get the idea.
Handy Tip: If you are paying monthly phone or gadget insurance, check to see if your household insurance policy also covers these items, as you may be paying for something you don’t need.
6. Apply a cooling off period to large purchases
If you do get tempted to buy a significant non-essential item, then take a step back, wait a day or two, and then think again if you really did need it. Chances are, that spur of the moment must have purchase, is not so important any longer.
7. Try a no spend weekend
Set yourself a no spend weekend challenge to boost your saving money plan. Identify what you can do for free, and then do that instead of spending a single penny. Impossible you say? Try walking or cycling, free museums or galleries, staying in and playing board games, Nintendo, watching box sets or a selection of great movies.
8. Take the 2p savings challenge
Simple but effective. Find a bottle or pot etc, and save just 2p on day 1, 4p on day 2 and 6p on day 3, 8p on day 4, and whilst this seems like tiny sums of money to begin with, by the time you have completed your challenge 365 days later, you with have a pot filled with circa £1,300. Make sure you start with a large pot!
9. Clear expensive debt ASAP
Identify if you have any expensive unsecured debt (not mortgage) such as store cards or credit cards, which can charge you anything from 20% to 60% in interest. Put them in a list with the most expensive (highest interest rate) at the top. This is your first priority debt to clear as quickly as you can. Once this first debt is clear, then move onto the next one until all your expensive debts are cleared.
Handy Tip: Going forward, don’t buy anything else on expensive credit. Ever.
10. Get cashback if you buy something online
If you do need to buy anything online, then by using a cashback website such as quidco or top cashback, you will make a small saving on those purchases as you will be credited with some cash into your account. Sometimes you only get 1%-2%, but on occasion you can get 10% or more on some products or services. Either way, many people make savings of circa £500 - £1000 each year simply by using these sites for products they were going to buy anyway.
11. Overpay your mortgage each month
If after you have worked out your budget, and put away some cash savings for a rainy day, you still have some spare cash to utilise effectively on your saving money plan, then over paying your mortgage can be a great long term money saving tip that saves you both money and the length of time of paying your mortgage. Even if you overpaid by just £25 / £50 or £100 per month, you would save thousands over the duration of your mortgage, and it would also shave several years of your mortgage term.
Handy Tip: Make sure to check that you can overpay without incurring fees. Most mortgages allow you to overpay by up to 10% each year.
12. Don’t pay your insurance premiums monthly (unless it is interest free)
Many insurance companies offer you the opportunity of paying your household or motor car insurance premiums monthly instead of an upfront single cost. Whilst this may seem like a good idea to keep costs down, you will actually pay much more per year than if you had just paid it off in one go. The reason is they charge you a high interest rate on what they call premium finance. Try to avoid it, or at least be aware of the interest rate they plan to charge you.
13. Consider where you do your food shopping
Consider downgrading the “class” of your usual food shopping destination to save money on your weekly food shops. For example, if your usual venue is Waitrose, they try Tesco or Sainsburys, if your usual is Tesco or Sainsburys, then try Aldi or Lidl.
Handy Tip: We all throw away and waste huge amounts of food each and every week. Try putting less in your basket each week, and not wasting so much at home.
14. Try a no spend week
This is the extreme version of saving money tip 7 and is not for the faint hearted! That said, it does seem to be all the rage right now, with some commentators even suggesting it can be done for a full month. So make a long list of things to do for free, and then just do it.
15. Check all your allowances and entitlements
This final saving money tip is very broad and can save or make you some significant money. With these allowances and entitlements, check to see if you are able to claim things such as job seekers allowances, the winter fuel allowance, pensions top ups, disability allowances, housing allowances. Also be sure to claim back any tax due from pension contributions, or overpayment of tax from having the wrong tax code etc.
Handy Tip: check on government or local authority websites for a full list of potential allowances.
Saving Money Tips Conclusion
We hope you enjoyed our selection of 15 saving money tips, and that you can put some of them into action. In closing, make sure you review your budget and check your progress against plan every month. This will ensure you can track your progress and identify and correct and issues if they arise.
We wish you all the best and every success with your money saving ventures, and invite you to subscribe to our community here.
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