Save money using these 5 easy steps. Following on from our last blog – “Should I ask for a pay rise?” we look at ways to save money. You can do this by creating a spreadsheet or using pen and paper. We’re pretty sure you’ll have identified a few savings by the end of this quick exercise.
Step 1 – Lists, everyone like a list – don’t they?
Have a think about your monthly outgoings, what do you pay for every month either by Direct Debit or Credit/Debit Card? Now categorise them under headings. Here are a few examples:
- Household Bills eg. Gas, electricity and water
- Travel
- Entertainment
- Car tax and insurance
Step 2 – Bringing the reality of your outgoings home
Now go through the list marking each item as essential (E) or luxury (L)
What we’re going to do now is roughly mark the monthly and yearly cost of each item. I like to list the yearly amount as it gives more focus, £50 a month sounds ok but when you multiply that by 12 and get £600 it makes you think just that little bit more!
Step 3 – This is where the magic happens
So, we’ve got our list, let’s look at hitting the luxury items first. These are normally the source for our easiest savings. Basically, ask yourself “Do I need this?” If the answer is no, then consider cancelling, or making a conscious effort not to buy again. If you’ve answered yes, then give the item further consideration, maybe you can buy something slightly cheaper or you can buy it less frequently.
Now the essentials – what can you do with these? Are they needed for your day to day living? You’re likely to have listed home insurance, car insurance or train fare and the weekly food shop etc. There’s potentially big savings in some of these, if you time it right and use the right tools then savings can be just a few clicks away.
Step 4 – Get on the web
Use some of the following sites to find those savings.
https://www.moneysavingexpert.com/
https://www.comparethemarket.com/
https://www.mysupermarket.co.uk/
Can you double up on a saving? For example you can half your cinema bill after you’ve saved on insurance cover by using https://www.comparethemarket.com/ and switching your cinema day to Tuesday or Wednesday – use https://www.comparethemarket.com/meerkat/movies/how-to/.
And, don’t forget sites such as Quidco and TopCashback – who will give you cash back if you use any of their listed retailers and brands – sometimes they will pay you a nominal amount just for visiting a website.
Step 5 – Find the small ones
Finally, if this has got you engaged and you’re really on it, analyse your monthly bank statement and repeat the process with accurate amounts and double check that you’ve not missed anything. How much does that daily Cappuccino cost you over the year?
Cappuccino £2.50 (Average medium cappuccino)
Days worked 5 (Based on someone working full time)
Weeks worked 45 (Allowing for holidays and the occasional day off sick)
Annual cappuccino cost = £2.50*5*45 = £562.50 – Wait until you’re in the office for that first brew and you’ve a potential saving of £562.50.
An easy way of tracking this moving forward is using apps such as https://www.ontrees.com/. These apps automatically keep track of your spending and tot up how much you spend spend per retailer, per category or however you want your outgoings represented.
Here are just a few savings someone at https://salarycalculatorpro.com/ made. We’ve rounded the figures up for ease of reading 🙂
Car Insurance £220
Combined Gas & Electricity £180
Home insurance £130
More than occasional Skinny Latte £345
A total of £875 over the year!
Are you able to sacrifice some of the luxury to make savings as good as these?
Go to https://salarycalculatorpro.com/, work out how much you’ve got to spend and then use the above to identify where you can save money.