Making your money go further

Andy Webb
The Money Advice Service
Last updated: 
October 1, 2020
Making your money go further is increasingly important as inflation is on the increase and typically incomes are not keeping up. This article looks at some simple techniques to stretch your money without compromising your lifestyle.

Top 20 "leaks"

A survey undertaken by the Money Advice Service showed the top 20 ways many of us feel we are wasting our money – they call it the top 20 ‘leaks’.  How many apply to you?

  1. Takeaway meals
  2. Paying for lunch or snacks while at work
  3. Satellite TV subscriptions for unwatchedchannels
  4. Paying too much for utility bills by not reviewing
  5. Buying too many ready meals
  6. Spending too much money at the pub or club
  7. Cigarettes and tobacco
  8. Mobile phone contract
  9. Paying avoidable bank or overdraft charges
  10. Paying avoidable credit card charges
  11. Paying too much for home insurance
  12. Paying too much for car insurance
  13. Netflix or similar subscription
  14. Paying fees at cash-tills to withdraw cash
  15. Paying avoidable credit card annual fees
  16. Unwanted magazine subscriptions
  17. Gym membership which is hardly used
  18. Subscriptions for apps that are hardly used
  19. Amazon Prime membership

Take a look at your bank account; it helps to understand how you currently spend your money before you try to make savings. 

For each of the ‘leaks’ there is help available to help you reduce the waste…

Review

We all know we should regularly review our household services, loans and insurances. The total cost of these can add up to account for the biggest proportion of our expenditure so savings here can really mount up.

Interestingly, mortgage payments do not appear in the "Top 20" but they can be one of the biggest offenders. Mortgage payments, loans, energy bills and house and car insurance costs can all benefit from a review using the available comparison sites and this can help save you hundreds of pounds a year.

Finding the right comparison site can be a task in itself, so this link takes you to a useful article from the Money Advice Service describing how to find the best comparison site and how to use them.

Useful Hint

Set an alert on your mobile phone a month before the renewal of your insurances (3 months before your mortgage rate expires or annually for utilities and other insurances) reminding you to set aside some time to review your rates.

Plan

Late payment charges can easily be avoided if you set up a regular payment from your bank. For example, you can set up a direct debit to pay off the minimum, a set amount or the full amount on your credit card each month. This can ensure you are never late and never miss a payment. You can pay more at any time during the month, but you know you will not impact your credit record.

Planning your meals so you can avoid costly takeaways and lunchtime trips to the cafe is a great way to save money – but it can also be tastier and healthier. Cooking a little more the night before and taking in the leftovers the following day can make a big difference. Assuming you spend £3.50 a day on a sandwich and crisps, that is £17.50 a week, £70 a month or £840 a year! That will make quite a dent in your credit card balance!

Useful Hint

If you are always busy you may be in danger of missing deadlines for bills and incurring late payment charges.

Contact your bank and set up a regular payment to avoid these charges and the negative effect on your credit score.

Do you need it? Can you afford it? Do you want it?

Whether you are considering a new purchase or reviewing those subscriptions you have leaving your bank account each month, ask yourself these three questions and you’ll make better decisions. Cancelling subscriptions you don’t use is a bit like cleaning out the cupboard under the stairs – you’ll feel much better afterwards.

Vouchers & Deals

Very few of us have the time to devote to extreme couponing as seen on TV, but there are some useful apps and websites that can make those little treats we all deserve a little more affordable. If you use O2 as your mobile phone provider, you automatically qualify for Priority deals – from a free coffee at Caffe Nero on a Tuesday, advance notice of tickets and events or discounts to some popular retailers.

Professional services

Do you need help from a lawyer, accountant or financial adviser? Some of these services may be provided through your Flex programme but you could use the links below.

Find a solicitor
Find an accountant
Premier IFA services

Making your money go further is increasingly important as inflation is on the increase and typically incomes are not keeping up.

Making your money go further is increasingly important as inflation is on the increase and typically incomes are not keeping up.

Andy Webb
The Money Advice Service

Andy was the Money Advice Service’s senior blog writer and media spokesperson from May 2014 to May 2018, having previously spent 10 years at the BBC.

Andy was the Money Advice Service’s senior blog writer and media spokesperson from May 2014 to May 2018, having previously spent 10 years at the BBC.

Next up...

How to avoid pension scams

Last updated: 
May 10, 2021

Don’t let a scammer enjoy your retirement – find out how pension scams work, how to avoid them and what to do if you suspect a scam.

READ MORE

Model your options with our Pension Options Calculator

Last updated: 
March 1, 2021

Gain an in-depth understanding of how the decisions you make today will shape your retirement with our Pensions Options Calculator.

READ MORE