AD | Collaborative post
Ollie Norman, Content Marketing Manager at LiQuid
In light of the escalating cost of living, the need to save money has never been more important. Given rising expenses and diminishing disposable income, it is now more vital than ever to establish an emergency fund to weather unexpected financial hurdles. In addition, if you are looking for ways to generate income in the absence of a job, having some savings tucked away can act as a reassuring safety net.
Fortunately, there is a range of methods to make savings, spanning from the tried-and-tested tactic of adhering to a strictly regulated budget, to more modern solutions such as money-saving applications and customer loyalty schemes. By merging these strategies, you’ll be able to maximise your savings – although remember, any saving should be celebrated when you’re just starting.
In this guide, we shall provide you with 10 tactical tips for money-saving that you can incorporate into your expense reduction strategy. These suggestions may not apply to everyone, but we are confident there will be a feasible option here for you.
1. Establish Your Budget
Beginning on payday, meticulously record all income and expenditures in a spreadsheet. It’s important to include not just the amounts, but also a brief description of each transaction. This allows you to separate the necessities such as utilities and groceries from discretionary spending, helping you compute your spending in each category.
While this task is slightly more complicated without a regular income, the fundamental principle remains the same. If your financial circumstances are unstable, you may find it helpful to compute an average over a three-month period, adjusting your potential savings month by month for careful financial management.
2. Identify Overspending Areas
Upon categorising your expenses, it becomes easier to pinpoint areas of excess spending. For instance, if energy bills dominate your outlay, consider switching to a more affordable provider or negotiate a cheaper tariff. If travel costs are high, explore more economical alternatives, and if impulsive shopping is a problem, set a monthly limit for such purchases.
3. Eliminate Unneeded Expenses
Analysing bank statements and credit card bills provides a unique opportunity to identify overlooked spending. Subscription services are frequently neglected, and many people continue to pay for subscriptions they’ve forgotten about. Stopping these unnecessary services could unlock more disposable income than you realise.
4. Modify Your Habits
Habits such as smoking often incur a substantial financial burden. Reducing or quitting such habits can lead to considerable annual savings.
This doesn’t necessarily entail quitting entirely. Switching to a more economical alternative like vaping can result in significant savings. Online retailers often sell vape juice for as little as £1, making this an ideal money-saving option for regular smokers.
5. Calculate Your Savings Potential
After you’ve determined your essential monthly outgoings and identified areas for cost reduction, you’ll have a rough estimate of your remaining disposable income. Divide this into savings and spending money. While the desire to save as much as possible can be strong, it’s crucial to allocate a reasonable portion for daily expenditures. Remember, the key to saving is regular, consistent contributions, not sporadic, sizeable deposits.
6. Earn Supplementary Income
There are countless opportunities to generate passive income, many of which can be found on this site. For example, you can earn by participating in market research, completing surveys, or serving as a secret shopper. Often, these tasks pay in vouchers rather than cash, but these can be used towards essentials or treats, allowing you to reallocate a matching amount from your disposable income to your savings.
7. Utilise Coupons and Discount Codes
In addition to free vouchers, there are plenty of free coupons and discount codes available. If you don’t have the time to hunt for these, there are apps designed to find these codes for you. This is a convenient way to save money without making drastic lifestyle changes.
8. Diversify Your Shopping
Whilst it’s tempting to make all purchases in one large, weekly shop, this approach overlooks potential savings available at other retailers. Comparing prices at different stores ensures you get the best value for your money.
However, remember to consider delivery costs if you’re shopping online, as these could offset any savings made.
9. Discover Free Alternatives
A wealth of free entertainment options exists if you know where to look. If you’ve cancelled subscription services, seek out free counterparts that provide a similar experience. While these may come with adverts, remember that some sacrifice is needed to save. Account sharing with a friend could also be a viable option but ensure to check the terms of service first.
10. Opt for Cash Payments
If managing your finances and real-time expenditure tracking is challenging, consider using cash. Withdrawing the exact amount of your budget allows you to physically see your remaining funds after each purchase.
Seeing the money exchange hands can also make you more accountable for your spending, which can be less tangible when paying via phone or card.
These are just the initial steps, but even adopting a few of these practices can lead to a surprising boost in your savings. One final piece of advice: ensure you’re leveraging a competitive interest rate to let your savings grow without any additional effort from you.