7 Ways to Save Money on Your Monthly Outgoings
You’re not the only one. According to Forbes, 78% of people live paycheck to paycheck.
It’s not a nice feeling to be out of money by the end — or even the middle — of the month, but there are things you can do to help stop that from happening. In this article, we look at changes you can make to cut down on your monthly outgoings and make your money last longer.
Following the simple advice below could save you over £4,000 per year.
1. Take Advantage of Money Management Apps
There are lots of money management apps out there that can help you track and manage your spending. From monitoring where your money is going to setting personal budgets and spending caps, these little tools are a powerful way to make sure your money isn’t running away from you.
The trick with these apps is to treat them seriously. Use them like a business would, checking on expenses and making hard choices, setting budgets and sticking to them relentlessly. Failing to use these apps properly can just make you feel worse about your spending as it becomes even more obvious how tough your situation is becoming.
Make a commitment to a money management app and yourself — pledge to follow the rules you set and you’ll start to see impactful benefits in no time at all.
2. Cut Down on the Costs of Food and Drink
There are lots of ways you can start to create a healthier bank balance simply by being aware of what you eat. Most people spend around £500 per year on takeaways, costing about £12 per person, per takeaway. Supermarket or homemade alternatives, however, can be a great and budget-friendly alternative. A pizza from the shops instead of a takeaway can easily save you £10 or more.
Another way to cut down on monthly food and drink expenses is to take your own coffee and lunch to work. An insulated bottle can keep coffee hot for hours and save you a trip to a coffee shop while taking meals to work removes the temptation of going out for lunch. You can take savings even further by bulk cooking and then freezing lunches like curries or pasta dishes to not only enjoy a delicious lunch but also save a good chunk of cash.
3. Be Smart with Travel and Commuting
The average UK worker pays £66 per month travelling to work. Then you have the cost of other travel, such as to see friends, family, visit the shops and so on. You could be spending over £1,000 per year on travel. Any technique you can use to cut down on travel costs will help you manage your money better.
So what can you do?
You can cycle to work — or rollerblade if that suits you better. You can also carshare, take public transport or just plain old walk. You could also discuss the opportunity for home working if possible. Following the COVID-19 outbreak, many more businesses are capable of sustaining remote working and are reviewing their own working policies, so now is the perfect time to have these kinds of discussions.
4. Buy Own-Brand
Own-brand vs branded really makes a huge difference. Studies have shown that if you switch from your favourite brands to supermarket own-brand products — everything from mayonnaise to pasta sauces, you can save over £1,200 per year on your food shop.
This is a simple switch and may require trying out new products and even different own-brands across different supermarkets to determine which offers the best savings and the products to suit your tastes. Still, there can be no doubt that with a bit of thought and careful buying, you can save a small fortune every year.
5. Unload Your Subscription Packages
The average UK resident pays £55 per month in subscription packages to technology companies such as Spotify or Netflix. That’s over £600 a year — and before you add in your phone contract, gym membership and any other monthly service fees you might be paying.
By thinking about your monthly payments, you can make choices to cut down on them. From getting a cheaper phone to only using a single streaming service and going for a jog instead of running at the gym, there are lots of ways you can reduce your subscription service payments to free up cash flow.
6. Save on Energy Bills
Being more energy-efficient can save you massive sums of cash.
In the USA, one study found that by becoming more energy conscious, you can cut bills by up to 25% — which is an average saving of $2200 (based on US data). Simple changes like turning your thermostat down by one degree Celsius can save you around £80 per year.
If possible, we recommend getting a smart meter installed in your home. This device allows you to see how much money you’re spending in real-time. Through this practice, you can start to see what activities are costing you, from a clothes wash or a bath to watching TV and mowing the lawn, and what you could do to lower that cost.
7. Prioritise your Debts
Most people have some form of debt, whether that be credit card, overdraft, personal loan or a buy-now pay-later agreement — which have become increasingly popular over the last couple of years. When you take time to review your debts and see how much you are spending each month paying them back, it may surprise you.
If you are looking at ways to save money on your monthly outgoings and you have debts, the first step is to prioritise your debts and pay those with higher interest rates first. A simple switch to a 0% credit card may be just what you need, or your debts may be such that you are finding it difficult to manage, and don’t have the option of a 0% transfer.
If you are still struggling with debt after you have implemented other money saving tips, it may be time to seek professional guidance to help you find a solution and take back control of your finances.