As the cost-of-living increases and household bills continue to soar, for many people it’s a worrying time. From COVID-19 to Brexit and beyond, there are many factors that have led to price hikes across the country, meaning many UK households are feeling the squeeze – myself included.
Luckily there are several simple ways that can help you reduce your outgoings, keep your monthly expenses down and feel more positive about your financial wellbeing.
In this blog post I’ll be looking at a few simple, but important tips and tricks that have helped myself and my family stretch our money budget further, relieve stress, and give us a better sense of financial control.
Set a budget (and stick to it)
Losing track of where we’re spending our money throughout the month can mean we quickly see our expenses mount up.
Creating a simple budget to follow can help you better understand where the bulk of your money is going, where you may be overspending, and where you could be cutting back.
Try starting simple and separate your spending into “needs”, “wants” and “goals” if you don’t want to track every single item. That way you’ll be able to monitor and adjust your overall spending in each category as needed.
The three most important things to consider when setting up a budget are:
- Determining your overall income
- Determining your fixed monthly bills e.g. mortgage, rent, utilities, childcare etc
- Determining the things you can’t do without e.g. food, petrol, medical expenses etc
Whatever is left over is your discretionary spending, from which you can allocate a certain amount towards savings, paying off any debts, socialising with friends, or new clothing etc.
Take stock and trim your monthly subscriptions
Netflix, Spotify, Disney+, Amazon Prime, gym memberships – each month, subscriptions can quickly eat into our expenses, many of which you may not really use.
Make a list of all your monthly subscriptions and be realistic when asking yourself if you still use them. Do your homework on the most cost-effective alternatives, like free gym passes or free music streaming. Ask a friend or family member to share the cost of subscription with you, stream content creators and originals on YouTube or look for free movies and box sets from apps such as FreeVee.
Freevee Logo: https://www.amazon.co.uk/adlp/freevee-about
If you have multiple bank accounts with different bills going out from each of them, you could lose track of the subscriptions you are signed up to. Money Dashboard and Snoop are two apps that can help you get an overview of all your accounts in one place. Once you have a summary of your finances it should be easy to spot subscriptions you don’t want or need.
Some banking apps also have features that make it easier to stay on top of bills. Starling Bank for example offers ‘Bills Manager’ which allows you to set aside money each month just for your bills, so you ensure you don’t fall short.
Be smart with your food shop
Shop around for the best deals on groceries – swap to doing the monthly big shop in cheaper stores or look for supermarkets’ own branded products over expensive named brands, particularly for staple products like pasta, rice, bread, and tinned foods.
It’s easy when wandering through the supermarket to get pulled in by enticing-looking extras that we really don’t need. Before you head to the shops, write a list, and stick to it. Better yet, do your grocery shopping online and avoid any impulse purchases – just be mindful of any pricey delivery charges.
Hello Fresh: https://www.hellofresh.co.uk/
Alternatively, taking advantage of discounts on meal kit subscription services like Gousto or HelloFresh can help you save some serious time and money. Once signed up you’ll receive weekly offers via email. Used wisely, these deliver-to-door recipe boxes can mean less food waste, more space in the fridge and less packaging in the bin. Since your ingredients are all neatly packaged up and ready to go, with easy-to-follow recipe cards and instructions, you can let loose and cook for the sheer joy of it, picking up new skills along the way!.
Compare services for the best deals
Many of us allow our bills to continue to roll over without shopping around to see if we’re really on the best deal.
Phone, internet, gas, insurance, TV, and electricity markets are constantly changing, and what may have seemed like a great deal six months ago might no longer be the best offer available.
It can seem tedious to try and keep on top of utility offers, but it’s essential to do your research. You may be pleasantly surprised at the money you can save by switching providers or taking advantage of any seasonal or holiday offers your current providers may be running. Personally, I’ve always found that I secure the best deal by picking up the phone and speaking to a real person as opposed to a virtual assistant – rare these days – but extremely worthwhile.
Be prepared to negotiate and don’t be afraid to stand your ground. Every £10 that you can knock off is an extra £10 that could fund a savings pot, investment account, or maybe you’d just like a few extra quid in your pocket
Prepare your own lunch
While many businesses are now ‘back to the office’, you may be tempted to just pick up a sandwich and a coffee on your way to work in the morning. However, through the weeks and months, these small payments can begin to mount up to well over £100 or even £200 a month.
While convenient, splashing out on your favourite Starbucks order every morning or Tesco meal deal every lunchtime can quickly eat into your expenses. Try cutting your monthly consumable costs by packing your own lunch. Invest in a good-quality reusable mug and take your brew to work with you.
It’s beneficial to look online for some handy meal options that you can prepare over the weekend. Instagram is a great space to follow people posting weekly meal-prep ideas which are sure-fire to save you time, energy, and some serious £’s during the week. @boredoflunch, @athletelunchbox, and Joe Wicks’ @thebodycoach are great accounts to get your juices flowing.
Give your spare money chance to grow by investing it
Investing might sound like the last thing you want to do during a cost-of-living crisis, right? After all, there is always the risk that you’ll lose your money as the value of investments can go up and down unexpectedly – and you can’t predict when financial markets will rise or fall.
However, one thing to consider is that any money in your bank account could also be losing value in real time if the interest rate is lower than the rate of inflation. So, if you already have an emergency fund and there’s some money left over, you could give it more potential to grow by investing as any gains you make won’t be tied to fixed interest rates.
Investing is easier than you might think. At Two10, you don’t have to invest large amounts. Just pay in as much or as little as you like as and when it suits you, or you could replace the cost of your subscriptions with a monthly Direct Debit for the same amount – moving from wasting that money to investing it instead. However, do remember that with investing your capital is at risk, and you could get back less than you put in.
It just takes a few simple steps. Literally.
Reducing your monthly expenses can seem like a mammoth task but by and making little changes here and there can have a significant impact on your spending habits.
If, like me, you’re fortunate enough to live within 3 miles of your workplace, why not consider walking or even cycling? Just 2/3 times a week could slash some serious pounds off your fuel bill… and the waistline!
Need some unbiased guidance? Drop in for a coffee
At Two10, we understand the struggle many families are currently facing. From combating the rising cost of living to saving towards a comfortable retirement, we can help get your finances in order and achieve that sense of relief that comes from and feeling understood.
Our investment experts will make all the investing decisions, keeping an eye on all the various factors that impact financial markets so they can make changes to your plan to help keep you on the right track to achieve your goals.
So, why not find out more about what we do? Try out our handy investment calculator, speak to one of our friendly advisors on 01772 970470 or drop in for a 15/20-minute coffee and chat – it might just be the most beneficial conversation you have this year.
If you’re serious about your financial future, we are serious about working with you.
Risk warnings: With investing, your capital is at risk.
The value of investments, and any income from them, can fall and you may get back less than you invested. Tax treatment depends on the individual circumstances of each client and may be subject to change in the future. Neither simulated nor actual past performance are reliable indicators of future performance. Information is provided only as an example and is not a recommendation to pursue a particular strategy.