Want A Quick £1000? Try These 10 Cost-Cutting Tips
This article is for information purposes only, and should not be regarded as financial advice. With investments, your capital is always at risk. The value of your investment can go down as well as up, and you may get back less than you invest. Seek professional financial advice before embarking on any important investment or pension decisions.
If someone offered you over a thousand pounds for about one day’s worth of work, would you do it? Most of us would.
Spending a day to sort out your bills is the equivalent, yet so few of us do it! The potential rewards on the table, however, are well worth the effort.
As financial advisers in Newark, we talk a lot about pensions, inheritance tax and long term savings. The more “immediate things” like fuel, food, broadband and contract bills, however, also form an important of your financial plan.
So, in light of this here are 10 ways you can reduce your monthly bills, and increase your disposable income:
Personal Expense Reductions
#1 Train Fares
Potential savings: £100pa
Navigating the world of rail tickets is not easy. Indeed, it is sometimes cheaper to buy two singles, rather than a return!
To avoid spending more than you have to, try booking early or late in the day, at least 12 weeks ahead of time. Sign up to alerts when train tickets are on sale, and try splitting your tickets using tools such as TrainSplit and Ticketclever.
#2 Find Cheaper Car Fuel
Potential savings: £15 per journey, and possibly more
Of course, you could just walk or cycle more. However, if you need to keep your mileage the same, then keep your car as empty as possible.
Make sure you leave your roof rack off, and that your tires are always pumped up.
Limit your use of AirCon and do not fill your fuel tank up to the top (it makes the car heavier). Together, these tips can increase your fuel consumption efficiency by up to 25%.
#3 Reduce Your Mobile Bill
Potential savings: £15+ per month
This might be a funny one for a financial adviser to talk about, but we have phones too!
Mobiles can be a considerable monthly expense, so this is a great opportunity to save money.
If you have completed the minimum term of your phone contract, then you have paid off the handset. Consider a SIM-only deal, which can cost you as little as £10 a month.
Seriously consider whether you actually need a new handset, or if you are happy with your current one. If you do need one, then look into buying the phone outright and then using a SIM-only deal for the texts, minutes and data. This is often cheaper than paying the handset off over 24 months, for instance.
#4 Audit Your Bank Accounts
Potential Earnings: £100+
Even if you are happy with your bank, you might want to consider the potential rewards on offer if you switch. At the time of writing, some banks will give you up to £200 for doing so.
Some offer a packaged account, moreover, which offers insurance on travel and mobile phones, as well as car breakdown cover. These extras alone could save you well over £100 a year.
#5 Your Mortgage
Potential savings: £1000 or possibly even more!
As financial advisers, we know all too well that mortgages are usually your biggest expense. So the savings here can be massive if you are shrewd.
For instance, say that you owe £200,000 on your mortgage. If you can reduce your mortgage rate by 1%, then that’s potentially well over £1000 you could save each year.
If you already have a mortgage, look into remortgaging to see if you can find a cheaper rate or better deal. If you are a first time buyer, really do your research and consider finding a good broker to help you through the process.
#6 Balance Your Savings vs. Loans
Potential savings: over £100 per year per £1000 owed
Suppose you have £1000 to pay off on a credit card at 17%. The interest will cost you £170.
Then look at your 1.2% interest rate for the £1000 you have saved in your bank account. That’s £12 in earnings from interest – a mere fraction of the £170 owed above.
Since your savings are earning less than your debts are costing, seriously consider paying off at least some of the debt with at least some of your savings.
Household Bill Reductions
#7 Cheaper Food Shop
Potential savings: over £1000pa
If you shop at a higher-end supermarket, this does not mean you have to start shopping at lower-end stores in order to save on your food bill. (Although, you may be interested to check how much your last grocery bill would have costed elsewhere using Mysupermarket).
Rather, look at the products you are buying in-store. Just because some types of food products are more expense, it doesn’t necessarily make them better.
Often, you can find the same taste and quality of product, in the same supermarket, for much cheaper than the branded alternative.
Coupons are another great way to slash your food bill. Clubcard Vouchers can be useful too.
#8 Childcare Cost Reductions
Potential savings: well over £1000pa per child
This is such a massive expense that any opportunity to reduce it should be jumped on by parents. Luckily, there are a few opportunities you can exploit.
If your child is 3 or 4, then you can receive up to 15 hours per week of free ‘early learning’ classes. That’s 570 hours per year.
For instance, compare this to the cost of a childminder at a possible cost of £5 an hour, then that’s a considerable saving (£2850).
#9 Check Your Council Tax Status
Potential savings: over £100pa
Many people in the UK are on the wrong tax band, but are completely unaware. It’s worth checking through the government’s website. It only takes a few minutes.
Potential savings: £100+pa
If you are paying more than £20 a month for internet, then it’s time to shop around.
You do not necessarily need an engineer to come over, if you want to switch to a cheaper/better deal. You’ll only potentially need this if you’re going for a big upgrade in broadband speed.