Entries Tagged 'frugality' ↓

If you are looking for drastic ways to save money in the New Year. Here are some of the top ways.

1. Stop smoking. If you smoke 20. Your habit will be costing close to £2,000 a year. If your post tax income is £15,000 – that’s over 13% of your disposable income on reducing your life expectancy.
2. Stop Drinking. If you drink 20 pints a week, and reduced it to 3 pints. You could save yourself £42.5 a week or £2,210 a year.
3. Take away coffee. If every working day you buy a takeaway coffee from Starbucks with pasty. You can spend £4 a day or £1,000 a year
4. Rent out a room or Move. Rent or mortgage payments are usually people’s biggest monthly outgoing, so reducing these outgoings will have a big impact in saving you money. Moving to a cheaper area could save potentially huge amounts every month. If it was £300 a month, it would be an annual saving of £3,600
5. Reduce entertainment budge. Takeaways or rented DVDs can consume a large bill every week. Even one cheap £10 takeaway a week can cost over £500 a year. Rather than buy books or rent DVDs, make greater use of your local library or sharing with friends.
6. Cycle. 50% of car journeys are under 2 miles. These journeys can easily be cycled, saving you petrol money and parking costs. Look for other ways to reduce petrol costs by sharing cars, walking or not travelling at all.
7. Take a holiday in the UK. With the Pound falling against the Euro, now is the best time to save on a foreign holiday. With global warming who wants to hotter countries anyway? An annual foreign holiday can easily cost £500- £2,000 depending on flights and number of children.

There is a fascinating programme on BBC called Spendaholics. Basically, it looks at people who are seriously in debt and examines why and how it can be resolved. Although it is easy to feel smug that we are not spending £10,000 a year on shoes or mobile phones (like some of the participants), it still highlights issues relevant for many people.

We Underestimate How much We Spend on Inessentials.

A powerful technique the programme used is to work out how much the person was spending on shoes, coffee, or mobile phones in a year. They would then present the evidence. For example, somebody would see 212 pairs of shoes, 450 takeaway Sarbucks, 300 mobile phones all stacked up. Without exception, people were shocked to see how much they had spent on these seemingly small things. Quite a few had spent over £3,000 a year on say just takeaway breakfast. When faced with the evidence of how much they had spent, many just couldn’t believe it.

• It is easy to forget how much we spend on certain items. When we realise how much we spend, that in itself makes us want to change our spending habits. Many of us live in denial about how much we fritter away.

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Rising food prices have only increased the benefits of saving money on our grocery shopping. In the past few months, shoppers have been deserting ‘up market’ grocery retailers like Marks and Spencers, but demand at ‘cheap’ budget end supermarkets has been booming.

As well as choosing the cheapest shops and supermarkets, these are some more tips to save money on grocery shopping.

Buy in Bulk.

There are often significant discounts for buying in bulk. Buying multipacks is much cheaper than buying single. If the items are non perishable, store items in a garage or spare cupboards. This will also reduce the number of times you have to travel to the supermarket, saving on petrol costs. Try work out the average price per item / price per gram before deciding what to  buy.

Don’t Buy Items You Don’t need and can’t eat.

Supermarkets are always trying to get us to buy a higher quantity. Special offers like 4 for the price of 3 are enticing, but, unless you are able to eat 4 melons in a week, it is not worth buying. It is fine if the items are non perishable, but often we end up buying too much fresh food making the special offers an illusory way to save money.

Buy Own Brands

An easy way to save money is to buy supermarket branded food, rather than the more expensive branded items. The difference in quality is much less that the advertisers would like us to believe. For example, Tesco value baked beans are half the price of Heinz beans. But, it is actually Heinz who make Tesco value beans. They just add a little less sugar and more tomato juice! For most items, you would struggle to tell the difference between branded and non branded items. Therefore, this is an easy and effective way to save money.
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In a climate of rising prices and stagnant incomes many consumers are facing the unwelcome situation of declining disposable incomes. Furthermore, high levels of debt and the prospect of rising unemployment leaves many of us in a difficult situation.

These are some tips to save money and increase your disposable income.

Look at Your Biggest Expenses First

To save real money, it is always worth starting off with our biggest expenses first. These will be your mortgage, rent, insurance premiums, petrol. Evaluate each expenditure and examine possibility of cutting the cost. For example, with your mortgage make sure you are not sticking with your existing firm out of loyalty and paying too much. Even in the current climate it is worth trying to remortgage. Save 5% on your mortgage and you may find an extra £50 a month. Save 25% on toothpaste and you may find an extra 20p a month.

Don’t spend out of habit.

A good way to save money is to forget all your typical expenditure and start from scratch – working out what you really need and want. Some of your bills are essential like rent, gas and electricity. But, you may feel that the cable tv is not necessary or magazine / gym subscriptions that are rarely used. This approach enables a spring cleaning in your spending.

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Children are expensive. The cost of kids is estimated to be between $125,000 and $25,000. (see: Economics of Raising children) Clearly if you want to make savings in life, it is worth thinking about how much you spend on children – bearing in mind, that money is no guarantee of giving children a better start in life.

Some tips for saving Money:

Avoid Impulse Buying.

Children can be quite demanding about receiving new presents, especially when they know that their parents usually give in to their demands. If kids always get their way and receive things they want, you will spend too much, and they will become spoilt. It is much better to be strict and keep presents for special occasions like Christmas and birthdays. If kids really want something, help them to save so they can appreciate the value of money. If you are in the habit of buying what they want for a bit of ‘peace and quiet’, it is an expensive mistake.

Pocket Money and Work

It is a good idea to give only a small amount of pocket money, but, give the option of earning more through doing tasks. If it cost you $8 to have your car cleaned, offer to pay them $6 or $7 dollars. You get to save a dollar are your child will appreciate the value of work.

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There are a bewildering array of financial products on offer. Each one will help to improve our financial situation. But, some will be much more helpful than others. These are some suggestions about how to approach the market for personal finance.

Don’t Buy Under Pressure

Always be wary of being sold financial products and deals under pressure. The quick sale is one of the easiest ways to get a consumer to buy a product before he realises there are better deals on the market. Any significant decision about investment or taking a loan will benefit from being left for a day or two. This means you won’t be pressured into buying something you later regret.

Listen to Recommendations of Friends not pushy salesmen

When making any decision about financial products or buying goods it is advisable to take advice. The key issue is who do we take advice from? It is important to evaluate how trust worthy / independent a person’s advice is. If someone has an ulterior motive for suggesting a product we need to be cautious. Find someone who is knowledgeable about the field of finance and products and who can offer independent advice.

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There is a lot to be said for loyalty. Loyalty to friends, even loyalty to your boss; but, when it comes to loyalty to companies selling you goods and services you face the prospect of losing a lot of money. Companies are keen to retain our loyalty because they know it is the loyal customers who provide the bulk of their profits.

How Loyalty Can Cost You Money

Threatening to Cancel.

If you threaten to cancel your own internet / telephone services you will invariably be offered a discount to stay with the company. All this requires is a quick phone call to your phone / internet / mortgage company saying that you are thinking of leaving. Their first offer may not always be the best that they can give, therefore, hold out for the best deal; you don’t need to change services or arrange a new contract. The threat of leaving is sufficient to gain a better monthly deal.

Renegotiating.

When renewing insurance, firms usually have different deals for ‘new’ customers and existing customers who are renewing. The reason is quite simple, new customers are much more sensitive to price; therefore, to attract new customers the insurance firm has to offer the best deal. However, existing customers who are renewing are much less sensitive to price. Quite a high % may not even bother to check the price but just renew out of habit. Therefore, the firm can make higher profits. The best thing to do is to use a price comparison site to search through all the insurance quotes. Firms treat these inquiries as new firms. Many customers are surprised to find that their own company may offer them a lower price when they do this. Continue reading →

I have to admit the idea of haggling for a lower price doesn’t come easy. I have inherited a certain reserve often found in English people. But, haggling can save a lot of money, and there’s no reason why the big multinational company deserve the money more than you. Although haggling can involve a little effort, it is much easier than working for your money.

These are some tips for getting a better deal from shops.

1. Asking for Extra.

This is a good introduction to bartering. You don’t have to ask for a lower price, but just ask for an optional extra. For example, when buying a bike, why not try asking whether they would be able to offer a free lock to go with the bike. A shop is often more willing to give goods in kind rather than a cut in price. This is because it costs them less. Supermarkets are often offering 3 for the price of 2, so why not use this principle in getting some free extras when making a big purchase.

2. Create A Good Impression.

Good Haggling isn’t aggressive or competitive. The most successful way to get a good deal is to develop a good relationship with the shop owner. Perhaps you could offer praise for his shop and indicate that you would like to become a loyal consumer. When you have developed this relationship try asking for a discount. Be polite, but firm and avoid putting undue pressure on the shop assistant. This increases the chances of the shop being sympathetic to your request.

3. Pick Your Moment.

When bartering be sympathetic to the pressures of a shop. The best time to ask for discounts is when the shop is empty and quiet. If you try bartering when the shop is very busy, you are likely to get short shrift. Also the shop manager may be reluctant to give a discount if many other potential customers can hear. – they will fear getting requests from everybody.

4. Speak to the right person.

A new part time shop assistant is unlikely to be able to offer a discount. If possible try to speak to an assistant manager or supervisor who will be in a better position to offer discounts.

5. Timing of Sales.

The chance of a successful bartering depends on the life cycle of the product. If it is new and in season, it will be much harder to get a discount. However, if you see goods on sale or past their ‘high season’ you have a much better chance of getting a discount. When goods are on sale, it is often a sign that shops want to sell things quick and create space. This provides an excellent opportunity to get an extra discount. Try: “Could I help you get rid of this sale good?”
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Note today’s Post is by: Heather Johnson

In these tough economic times, being able to save some extra cash can really go a long way. There’s no perfect way to save extra cash, and everyone will have their own ideas and opinions on the best avenues to pursue. However, I’ve come up with 10 solid tips that can help you have additional money in your pocket.

1. Drive Less – Gas has been rising steadily recently. Many experts predict that prices will hit over $4.00 a gallon this summer. Keeping that in mind, gas will suck down many people’s budgets. A very good way to save money is to simply drive less. This can be achieved through car-pooling, public transportation, and simply being more efficient with fuel. The best way to be more efficient with fuel is to avoid extra trips by getting things like shopping done on the way home from work, or while you’re running other errands. Also, staying under the speed limit can also help. Going 75 Miles-Per-Hour burns much more gas than going 55.

2. Eat Cheaply – Eating cheaply doesn’t mean one has to eat badly. There are a lot of ways to save some serious money by cooking meals, and going grocery shopping with saving money as a focus. One problem many people have is that in their hectic lives, they can’t find the time to cook, and end up going out to eat more often than not. Not only does going to restaurants cost significantly more for the food itself, but you also are using gas to go to the restaurant. Looking for cheaper ways to make good meals is also helpful. For example, one of the cheapest things to make is pasta. I’ve found that making pasta with a variety of sauces, and maybe even some inexpensive chicken is a great, cheap meal.

3. Pay Credit Card Bills In Full – One of the biggest mistakes people make is racking up huge credit card debt, and only making the minimum monthly payments. If you are trying to save money, this is ultimately a bad idea because the rates will eventually catch up to you. The best move is to pay the credit card off in full, and then continue to do so in coming months. Paying only minimum payments is not a good way to save money in the long run, because the benefits are only short-term. Credit card companies want you to carry a balance on your credit card; don’t give them what they want!

4. Turn Off The Lights, TV, Etc – Did your dad ever constantly bug you to turn off the lights when you left the house? I know my father did. Turns out that parents complaining about leaving lights on actually have a point. The amount of money that can be saved by simply closing windows and doors, turning off lights and other electronic appliances, and simply watching electricity usage can really ad up. Continue reading →

It is often the case that a frugal lifestyle can make a big difference to also helping the environment.

These are some tips which will help you save money and the environment

1. Moderate Heaters and Air Conditioners.

To heat the house an extra 2 degrees becomes relatively more expensive and contributes to increased carbon emissions. Try getting used to having the thermostat a little lower and the air con a little higher. Just by wearing an extra jumper you can make a big difference to your bills and the environment

2. Maximise Insulation

You can save heating bills by maximising the insulation for your house. This can involve investing in upgrades such as loft insulation, double glazing and cavity wall insulation. Check to see whether the government or agencies may be able to subsidise this. My local council (Oxford) provided cavity wall insulation for free!. The above will pay off in the long run. But, you can also make immediate savings by cutting out drafts, closing windows and using thick insulated curtains.

3. Only Boil What You Need.

To Make a cup of tea, my lodger used to boil a full kettle, enough for 12 cups! Not only does this take longer, but it uses energy unnecessarily. Eventually, I got round to asking him to only boil minimum and it will make a difference to saving money and energy. Similarly when boiling vegetables don’t have the pan boiling for 30mins, there’s nothing worse than overcooked brussel sprouts!

4. Cycle and Walk.

Nearly 50% of all car journeys are less than 3 miles. All of these journeys could be completed by walking or cycling. Both of these types of transport are much cheaper than other filling up with petrol (gas). This is especially important with the price of oil being so high. As an added benefit it will also help you get fit!

5. Turn it Off.

Everyone know we should turn lights off when not in the room, but less well known is the cost of leaving electrical appliances on standby. If you leave your TV permanently on standby you will unnecessarily use electricity and energy.

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