I’ve always loved to start new projects and come up with fresh ways to generate income. However, we sometimes get too focused on generating new income and neglect to properly manage the money we already have. the easiest way to maximise the amount of money in your pocket is to change your spending habits, and ensure you are not needlessly wasting cash. In this article, I go through 7 ways you can reduce spending and save more to put towards things you want, or invest in projects.
1. Reduce grocery spending by cooking in batches
This is something I have started to do religiously over the last year. When looking at how much I was spending each month on lunch it sent a shiver down my spine. It was not uncommon for me to be hitting monthly spends of around £150 (£1,800 a year!) just on lunch, as I ate out every day.
Since then I have invested in a large slow cooker, and I now prep my meals for the week every Sunday. This has significantly reduced the cost, and I now spend around £40 for the month. I also freeze some of the batches so I can alternate between food each day instead of having the same thing each day. This is one of the quickest ways I reduced my monthly spending, and within a month I noticed a difference to my bank balance.
2. Stop buying your morning Coffee
I used to spend an absolute fortune on take away coffees. If you get one on the way to work each day at £2.20, that equates to £44 per month or over £500 a year!
To break this habit and curb my spending I now prepare my coffee at home use an Aeropress which is a great little gadget and just as quick to prepare as instant coffee (but tastes so much better!).
3. Walk/Cycle to work
Okay so I should admit, I don’t currently walk or cycle the whole way to work. But I do now get off a few stops early and walk the rest of the way and this saves me £90 a month or £1,080 a year! How? Well my office is in London Zone 1 and I live in Zone 4, so If I get off in Zone 2 and walk the last 20mins it means I can get the 2-4 travel card which is £80 a month cheaper that 1-4. That’s a huge saving, plus, it means I get more exercise so it’s a win-win!
4. Switch your phone contract to SIM only
You might love your phone, but do you really want to spend so much for it each month?
Most new contracts can be upwards of £45 a month which is crazy when you consider that a SIM only deal is only around £15. Next time you are due an upgrade, seriously consider switching over to a SIM only plan and reduce spending to save yourself hundreds of pounds over the course of the year.
The rate at which phones are changing has slowed down over the last few years, for example the new IPhone is not that different from the version which came out in 2014. Apple also have a new program where you can get a replacement battery for £35, which is a great option as poor battery performance caused many to upgrade in the past.
5. Don’t upgrade your lifestyle when you get a pay-rise
Have you ever got a pay-rise at work and immediately thought how you were going to spend the money, starting with an expensive meal out? One thing leads to another, and before you know it you are still left with nothing by the end of the month. This is what experts refer to as ‘Life Style inflation’, and it’s when you change your spending habits to use up your new income, instead of saving it.
6. Cancel un-used subscriptions (or share with friends!)
If you’re like me then you subscribe to a lot of different TV services, magazine etc. And have several different Direct Debts hitting your bank account each month. I used to continue to pay, even if I only spent a small percentage of my time consuming the content each month, however I have now adopted the 5-hour rule. If I consume something for less than 5 hours each month I cancel the subscription.
Sharing the cost of subscriptions with friends is also a great way to reduce spending. For example, with the top tier Netflix account you can have 4 people logged in at once, so if you split the cost that’s only £2.50 each per month, less than half the cost of the basic subscription and you also get access to the 4K content.
7. Use a Credit card for purchases (But make sure you pay it off straight away!)
Okay hear me out, I know that sending money on your credit card doesn’t seem like a good way to save. However, with a lot of major credit cards you get cashback on purchases at the end of the year, and some have other promotions and rewards which can amount to a lot of free money.
For example, Amex Gold has a particularly good offer where if you spend £2000 in the first three months you get a £100 Amazon voucher, plus there are no fees for the first year. I signed up for this last year when I moved into my new flat as I knew I’d hit the £2k target on purchasing new furniture etc. I then received the voucher and cancelled the account, so it cost me nothing and the voucher helped cover my Xmas shopping (I’m sorry to admit I do most of my gift buying on Amazon!). As well as the voucher, they also gave me two free passes for global Airport Club lounges, which saved me further money when I went on holiday (As all food and drinks are free in the lounge), plus I got to feel like a VIP!
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