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With interest rates remaining low and stock markets so volatile, we have
to think of other ways to make our income and savings go that bit
further. One way of doing this is by reducing expenditure. Instead of
spending hours researching the best interest rates and then more time
switching accounts, think about ways of making savings in your everyday
life. |
In this article we have seven tips for doing exactly that. Some of them may seem obvious, but actually putting these ideas into practice can make a massive difference to your income and savings over the course of a year.
1. It might sound a bit like something you were encouraged to do as a spendthrift teenager, but putting your change into a jar each night is a very sensible way of saving. Lots of people are rediscovering the concept of saving their loose change instead of spending it. You might want to save for a weekend away or a special occasion and you’ll be amazed how quickly your spare change will add up. If you think about it, one pound thrown in the jar each night by two people will amount to more than £700 at the end of the year, and you won’t even notice it. Invest that one amount at 5% over 5 years and you will have almost £4,000!
2. Cut out the small spending. Do you really need a daily paper? You can get all the news you need from the TV or radio or on the internet, even the crossword or Sudoku puzzle are available easily at no cost from internet sites. Cut out confectionery; have a piece of fruit from home instead of a Mars bar – cheaper and healthier too. Think “Do I really need this, or is it a luxury?” before paying for anything under £5 and you will be amazed how much you can reduce your spending.
3. Eat out less. We’re not talking about the big dinners in posh restaurants on special anniversaries, but the casual convenience food. Things like fish and chips, packets of sandwiches, Starbucks and afternoon tea. Cut back on convenience food and, dare I say it, visits to the pub, can easily result in some big savings over a relatively short period..
4. Rethink your service providers. Are you paying too much for gas, electricity or telephone? Spend an hour or two on internet comparison sites to see what other companies are providing by way of deals or reduced charges. Do the same with your insurance policies. Changing a service provider or insurance company can save some serious cash
5. Nobody over 40 should buy anything on credit! Seriously, debt, especially credit card debt, is the major reason why people fail to meet savings targets. You usually pay more for the goods than a cash buyer; you certainly pay massively high interest rates and you might even pay penalty late fees. Don’t buy anything on your credit card unless you are certain of being able to pay off the whole amount as it falls due. If you already have credit card debt, try and pay it off quickly, never just pay the minimum amount or you won’t clear the debt for years. Once you have paid off your credit card debt by monthly instalments, why not continue to pay the same monthly sum into a savings account? You might also consider switching to another card to take advantage of interest free periods and/or lower interest rates.
6. Try to use the car less. Petrol and diesel are at record prices and are not going to come down anytime soon. This can be a major savings area. Don’t go shopping any more than you have to. Consolidate trips or have items delivered. Make more use of public transport. If you don’t live near a bus stop consider the possibility of driving to the nearest one and then catching a bus from there, especially if you have a free bus pass.
7. Can you make a few minor sacrifices? Go to the library instead of buying a paperback novel; turn down the heating a notch and put on a sweater. Turn off the radiators in spare rooms. How about buying books and DVDs on eBay and then selling them back?
These are just a few changes that you might consider, but if you really think about it there must be lots of other ways that you can make savings directly related to your own personal circumstances. A few small changes to your lifestyle can make a big difference to your expenditure and enable you to make savings towards those things that make life so much more enjoyable. Holidays and weekends away become achievable, or simply having more money in the bank or investments can bring peace of mind – and that’s priceless.