How we’re spending our money has changed so much over the past 12 months. Whether you have saved more or exhausted your funds, we all need a little financial inspiration to help us save where we can. So, check out our twenty-three tried and tested money-saving tactics. You’ll be amazed at just how much you can save without even trying.
1 – Save first, spend later
Pay yourself first. If you do this it’s a sure way toward financial freedom. Use the 50/30/20 flexible approach to budgeting. This means 50% of your take-home pay goes on your needs (bills, food, minimum debt payments), 30% goes towards fun (eating out, etc) and 20% goes to future you (debt payments above the minimum, saving for emergencies and investing). If this split doesn’t work for you when money is tight, you can adjust the ratios as you go.
2 – Don’t pay interest on your credit card debt
If you’ve got card debt, put a strategy in place for getting rid of it. Don’t panic if you haven’t got a handy lump sum to magic away the full amount, you can achieve the same end result by transferring the debt to a 0% balance credit card to avoid paying interest for a fixed time (up to 30 months) and paying off a set amount every month.
Some cards come with small balance transfer fees, so make sure you do the maths. Do set up a direct debit to avoid missing minimum payments and being stung with high charges. If you still have debt after the 0% period ends, move to another deal. Do not use this card for purchases. Find the best 0% balance transfer card using comparison sites.
3 – Stay on track
Don’t let cash slip through your fingers. With a digital bank like Monzo, you can transfer a set amount of spending money to your card while prepaid cards only let you spend what you load.
Too high-tech? Set up a day-to-day spending account with its own card, and transfer your weekly disposable income onto it.
4 – Use an incognito browser
Going incognito when you shop online can help you save money by automatically deleting your browser history when you close a tab. This means companies can’t track what you’re looking at and put prices up (yes, it happens!), so it will be especially useful for planning your next holiday.
5 – Don’t splurge on payday
Nationwide’s Payday Saveday survey revealed 1 in 5 people spend over half their spare monthly wages within 48 hours of getting paid! Don’t let your disposable income burn a hole in your wallet, always ask yourself if you really need it.
Prioritize your most important outgoings, plus something for the savings pot, before you start spending. That way, you’ll know how much disposable income you really have to last the rest of the month.
6 – Get savvy with your savings
If you haven’t already, maximize your £20,000 tax-free ISA allowance. You can either put money into a cash or investment ISA. Admittedly, rates for cash ISAs aren’t great at the moment, but you’ll get more the longer you are prepared to leave the money untouched.
You don’t need a lot of money to start investing, nor do you need to be an expert. Some investment apps even let you begin with just a few pennies by rounding up your loose change every time you spend.
7 – Claim working from home tax relief
If you’re still working from home as a result of the coronavirus pandemic, you could claim some money back for working from-home expenses in the form of tax relief. Anyone required to work from home, even for one day, could apply for tax relief last tax year for the whole 2020/21 tax year.
8 – Weather the storm
If the current crisis has taught us anything, it’s the importance of a rainy-day fund. If yours has taken a battering recently (or you never really had one), start saving – anything is better than nothing. The rule of thumb is to have three months’ income saved for emergencies, ideally six if you have a mortgage.
9 – Beware the BOGOFs!
How many times have you walked into a supermarket and fallen victim to a BOGOF (Buy One Get One Free) deal? We’ve all done it. We go to the monthly food shop and we get swept away by all the ‘money-saving’ opportunities that we see on the shelves. But did you know that the average person in the UK spends £1,300 more a year on these BOGOF deals than they need to? The money you spend buying three bottles of Coke when you only need one is significant and these deals not only cost you dearly but may also contribute to food waste. So next time you go shopping use the calculator on your phone to work out how much you could save by not falling for the BOGOFs.
10 – Switch supplier
Spend 15 minutes on a comparison site and, you are almost guaranteed to find cheaper deals on your household bills. Ofgem calculates that the average household can save £300 a year by switching to a better energy and gas deal.
If you haven’t done this in the last 18 months, now might be a good time to grab your latest utility statements and check out comparison sites. Don’t stop there. When the insurance comes up for renewal, look around for cheaper deals.
11 – Remortgage!
If your fixed-term mortgage deal has come to an end you may be paying a ‘loyalty’ penalty of high interest which could add up to as much as £1000 a year. So, talk to your mortgage broker about remortgaging to the best deal for now, or find an independent mortgage adviser.
12 – Shop for own brand
Swapping branded products for own-brand alternatives is an easy way to slash the price of your shopping bill – from cornflakes and pasta to oven chips and washing up liquid. If you’re worried about the taste being compromised, ‘blind’ test them out on the family first! If they don’t notice the difference, you’re onto a winner!
13 – Waste less food
Almost three-quarters of what we throw away in the home are edible. Make a conscious effort to use everything you buy and you’ll save a fortune.
If you’re worried about food safety, remember: the ‘use by’ date is the cut-off after which it is not considered safe to eat the food. However, eating food past a ‘best before’ date won’t cause any health issues.
14 – Claim back money with your name on it
From forgotten bank accounts to tax rebates, you could be sitting on a pot of gold without even realizing it. Do you hold a sneaking suspicion that there might be savings somewhere with your name on?
15 – Check your insurance policy
If you are going to be using your car less as a result of the pandemic and working from home more, check your car insurance is still the right fit. Never auto-renew, always check for better deals via your existing supplier and comparison websites.
16 – Cut your grocery bill
Buying only what you need may sound like an obvious way to save money, but it can be easier said than done. Once you’ve planned your meals for the week ahead, you can use your groceries online store option to estimate your total bill.
Get to know the world food aisle in your supermarket (it hides savings of up to 75% on cupboard staples including rice, lentils, beans, spices and sauces), shop in the evenings for discounts, look at lower supermarket shelves for smaller prices, don’t pay for plastic bags and make your fruit and veg last longer.
17 – Have a no-spend day
Exercise some self-discipline and try to have at least one no-spend day each week, it’ll make you more careful with your cash in the long term. This can be as simple as having last night’s leftovers rather than buying lunch out, snacking only from your weekly shop, and carrying coffee/tea in a kept cup. Require more than one brew a day? Many chains cut the price of your beverage if you bring a portable mug.
You can cheat on travel expenses if it’s absolutely necessary. Or, get paid to walk with smartphone apps that exchange your steps for store discounts and freebies.
18 – Check your workplace pension
When you start at a new company or when your employer sets up a new pension scheme, you will usually receive information to agree on the percentage of your salary that will be paid into your workplace pension. Your employer will then deduct your pension contributions directly from your wages before paying you.
It’s important to check your pension to make sure you’re saving enough for retirement and you’re happy with how your pension is being invested. It’s also worth checking whether your employer will match pound for pound any personal contributions you make, which is like a pay rise – or free money! – to your future self.
19 – Paperless energy bills
If you ditch paper bills and become an online customer, you’re almost always more likely to get access to a range of better deals and cheaper plans. Not to mention you can monitor and manage your account online or through a smartphone app.
20 – Track your spending
The more conscious you are of what you are spending the less likely you are to overspend. Use free budgeting apps like Mint to monitor all your accounts in one place on a handy dashboard.
Digital banks are also great at helping you manage your spending with a number of budgeting tools within their apps. It could be useful to check your current spending pattern as it may differ from your usual one.
21 – Try a little patience
When shopping online, fill your shopping basket but don’t check out immediately (unless it’s something that’s selling like hotcakes). If suppliers spot items sitting in your basket for a day, they’ll get in touch to ask you if you forgot to check out and sometimes they’ll send you a discount to persuade you to return.
This only works if you have an online account with them, as they’ll need your email address.
22 – Ask for a price match
Some shops have a policy that if you find a lower price, they will beat it. While this isn’t the case at all retailers, it’s always worth asking, as a lot of popular shops have price match policies. Just do your research online first so that you can back up your claim.
23 – Manage your gadgets and appliances
It’s not a myth, a small amount of electricity is still drawn when a device is plugged in for charging. Instead of charging overnight, juice up for a couple of hours during the day and unplug to save on your electricity bills.
Did we mention that not defrosting your freezer is costing you more in energy, too? The more ice your freezer is fashioning, the more energy it uses. So, if the ice gathering around the inside is thicker than around 3cm, defrost it.
24 – Make the most of resale platforms
Did you know that the average woman accumulates an estimated £22,000 of unworn clothes over a lifetime? It’s time to make money while you spend it by exchanging your old outfits for cash via resale platforms.
You can also use these sites to hunt for top-quality gifts. Pre-owned doesn’t have to mean lower-quality – many items sold on these sites are brand new and often cost less than the original retail price.
25 – Check your workplace benefits
If you haven’t had time in the past to check out the benefits your employer may offer, now might be a good time. From healthcare plans and childcare support to local discounts, know what’s on offer, sign up and you’ll reap the maximum reward.