Posted on: 03 April 2020
Find out how much you can save with these small changes
Regardless of your income, the desire to spend exists in everyone and, in recent years, the ability to see temptation and instantly buy it has grown dramatically. One-click purchasing, stored delivery addresses and items tailored to get you adding to your basket, it's a minefield that is easy to find yourself in the middle of!
However, it isn't the 'big-ticket' items that prove to be our Achilles Heel. Instead, the lurking dangers on your bank statement are ones that are far closer to home.
It's only 'x' pounds!
Those four words are the most dangerous for your budget. The streaming service you haven't used for months, a sandwich and a coffee on your lunch break, or the magazine you always skim-read. All are purchases that you'll rarely look at when trying to save for a holiday, a mortgage, or something you want, but the reality is that they're adding up to become a much larger line item in your budget.
The average price of a medium latte is £2.45, and a small chocolate bar is £0.60, so assuming we buy these things three times a week, take this equation as an example:
(£2.45 + £0.60) x 3 = £9.15
(52 weeks in a year) 52 x £9.15 = £475.80
That example shows how a relatively small expense can quickly add up to become an amount that would make you notice if it were a yearly fee! There is the knowledge that with some minor readjustments, you can start making impactful savings without having to scale down your lifestyle too much.
'I deserve it' doesn't have to be something you no longer say but why not get the same a cheaper way. The chocolate bar we talked about earlier can remain in your life but why not reward yourself with one at the end of the week instead?
No cost doesn't have to mean no enjoyment
Everyone finds themselves bored in their free time occasionally, there isn't any financial penalty for that. The danger to your budget and finances lies in how you choose to eliminate the dullness. There are plenty of ways you can keep yourself entertained for little to no cost. Going to a park or for a walk, reading a book, or taking up a hobby such as drawing are great ways to take away boredom without breaking the bank.
Don't use it? Don't keep it!
Another mistake is that of hoarding, or just keeping something out of habit. If you don't use it - sell or get rid of it! There are plenty of ways you can sell it online.
One tip for clothes is to make a point of turning all your hangers facing one way. Once they've been used you turn them the other way and then, after a period of a few months or even a year, you can visually see which items you don't wear.
The same goes for streaming services or television packages. Do you regularly use them or are you just waiting for the couple of series that come out each year you couldn't bear to miss? Streaming services are particularly convenient because there is no cost to cancel and you can rejoin the services when the television you want to watch comes out once more. Some television packages do include a leaving penalty but if, for example, you follow a seasonal sport - why not downgrade your package when they don't play so that you can make sure you're not just burning money out of habit?
Don't be afraid to shop around online
Technology has meant that it has never been easier to spend, there has never been a better time to get the best price. Pricerunner is a great comparison tool that scours the web for the best prices for items as diverse as computer games, washing machines, phones, and lawn-mowers! MoneySavingExpert has a great list that can ensure you're never paying over the odds when you're online!
You know there's an app for that?
'Pennies make pounds' but tracking them can be a chore. Apps such as Monzo, or Revolut (which has a built-in budgeting tool) allow you to save without making too much of an effort by rounding up purchases made with them to the nearest pound as well as being able to set your saving budgets and aims. The only drawback with these apps is that they don't offer interest on your savings but they can be useful to build-up an amount for a specific goal.
Having a separate account
One way, that isn't particularly high-tech and won't require too much tracking is simply to open a different account for your bills. Work out what your monthly fixed outgoings are and set-up a Direct Debit for the account your wage goes into and set aside the right amount to be transferred each payday. If you want to have even more control - take the amount left and divide it by the days left until you are paid once more and try to spend less than that figure each day.
If we keep track of our spending, we can see where we go wrong and make changes. If you dine out a lot and are spending too much on restaurants, why not try cooking at home with ingredients that are versatile, making two or three different meals with them throughout the week. You could also make weekly meal plans before your shop to help prevent you from adding in extras that you don’t really need.
Being financially sensible doesn’t mean you have to be boring. A few tweaks to how and where you spend your cash can make big differences to your balance at the end of the month. Not only will the ability to save more help you with your financial health, but it might also help you out if you’re suffering with financial worries.