New Year, Better Finances: How to Spend Smart
Most of us would like to have some extra cash in hand – especially post-Christmas, when it’s often difficult to rein our spending back to sensible levels.
It’s a classic New Years resolution, but if you’ve tried and failed before, don’t be put off – we’ve outlined four ways to get yourself started anew.
Know your money
Keeping track of your finances can seem like a task and a half, and most of us aren’t as good at it as we’d like to be.
Figuring out where your salary goes every month will set you on track to saving and spending better, and it’s a great place to start when managing money – it’s also never been easier.
As you’d expect, there are plenty of apps (both free and paid) to help you get a handle on your expenses. Your bank probably offers one, but if you have accounts with multiple banks, an app like OnTrees could work well for you.
It pulls income and expense data from all your accounts so you can monitor everything in one place (though you can’t actually move money through the app, which makes it more secure).
If the idea of putting your bank details in the hands of an app doesn’t fill you with confidence, there are also apps where you enter transactions manually (such as Spending Tracker) and, of course, good old-fashioned Excel. There are even templates created by Microsoft if you don’t fancy building a spreadsheet from the ground
If you can’t remember the last time you switched electricity, gas and internet providers, now is the time to consider it. Providers bank on customers not bothering to shop around to make more money, and the amount you pay will usually increase significantly after your new customer perks expire.
MoneySavingExpert estimates that you could save £300 a year just by switching away from a standard tariff from one of the Big Six energy companies onto a smaller provider, or just asking for the cheapest tariff from your current provider.
Price comparison sites are a great tool, but bear in mind that some might only show providers who pay them commission in default searches, so make sure you have any “display all” options enabled.
For TV and phone contracts, flexing your haggling muscles can work well. Telling them that you’ve seen a better deal elsewhere will often get you a price cut, or some free extras thrown in. Don’t assume you have to own your home to reap the benefits either – if you’re a renter paying for your own utilities, you have as much right as a homeowner to change shop around.
Share the load
How many people are using your Netflix account and how many of those people are paying the subscription? If the numbers don’t add up, it’s time to draw the line and ask everyone to do their bit. The same goes for lift-sharing, homeware purchases with housemates, and spending on days and nights out.
Money conversations can be uncomfortable, but moochers also make difficult friends. Most of us know someone who mysteriously vanishes when it’s their turn to buy a round, and you’ll probably think twice about inviting them out again because of it. Honesty is the best policy and if they don’t respond to that, it might be time to get tough with them.
If you think you might be “that friend”, all is not lost. Make sure you’re the one to bring it up (saving them the potential awkwardness), apologize and offer to start paying your way. Give your friends the confidence to share costs with you in the future, and you’ll save money in the long run.
Plan your meals
Ever sat down and worked out how much money you throw out by wasting food? If the idea sends a shiver down your spine, chances are you’re losing out. You’re not alone either; the average UK household throws away £450 worth of food a year.
You can help your wallet (and the environment) by making the most of all the food you buy. This could be as simple as deciding what you’ll eat for dinner every night for the week, so you don’t buy what you won’t use.
If you have time to spare at weekends, batch-cooking evening meals or assembling salads for weekday lunches on a Sunday afternoon will save you money and effort during the week.
There are hundreds of recipes available for free online, including websites like Budget Bytes which not only breaks down recipes by cost (though it only comes in dollars), there’s also a feature that adjusts ingredients depending on the number of servings you want to cook.