Save money and make it go further

Save money and make it go further

Times are tight for a lot of us at the moment but these simple saving tips can really help.


If the new financial year inspires you to get on top of your money (so dull, but so important!), you might be interested in the 50/30/20 rule. And who wouldn’t want to slash what they spend on household bills? Or pay less interest on any debts?

Budgeting and the 50/30/20 rule

Budgeting may not be the most exciting task in the world but it’s the first rule of making your money go further. It’s simply a matter of adding up all the money you have coming in and the amount going out.

You can do this on paper or a spreadsheet, and there are even free budgeting apps out there.

You may also find the 50/30/20 rule helpful. The idea here is to spend 50% of your income on essentials, 30% on optional items, and put 20% away for savings or paying off debts. Now granted, for a lot of us this simply isn’t possible, with more than 50% of what comes in being swallowed up by essentials. But the plan still serves as a helpful guideline at the sort of split you should be looking for.

Here’s how it works

1. Essentials
First, you’ll need to work out the family’s take-home pay and halve it. That’s your first 50. Then add up what you’re currently spending on essentials: mortgage, food, clothes, utility bills and so on. How does this compare to that first 50?

2. Desirables
According to the plan, 30 should go on ‘desirables’. Of course, at times that can seem like a bit of a pipe dream. But if you are able to set it aside on months with special occasions like birthdays, then that’s great. And remember, the ‘desirable pot’ isn’t just for others. You deserve the odd treat and luxury just as much as they do.

3. The other bit
Finally the bit that no one likes – until they see the benefits: the 20% you’re putting away. Even if you can’t put away 20% each month, just setting aside what you can means you’ll soon build up for emergencies or those special occasions.

Saving money on bills

You can save hundreds or even thousands of pounds just by getting a new mortgage or reviewing the one you’ve got.

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And don’t let your shopping around end with mortgages: from mobile phone providers to energy suppliers to insurers, there are lots of companies out there fighting for your business. One word of warning though – although it’s tempting to just go for the cheapest deal it’s important to make sure you get something that’s right for you long-term.

Did you know…
Switching your thermostat down by just 1°C could cut your heating bills by 10%? Getting a water-meter fitted could help you reduce your bills, too, and it’s free.

Think value not cost

When times are tight, it’s natural to reach for the lowest prices, but it’s worth thinking about whether those products are really the best value. For example, Fairy will last you much longer than a cheaper washing-up liquid, for example, making it better value in the long-run.

You can also save with little changes to how you do your household tasks, without having to cut down on essentials like detergents. Read our tips for saving money on laundry for some ideas.

The ‘D’ word

If you’re in debt it’s important not to just bury your head in the sand. There are debt charities who’ll give you free advice and help you get back on top of things.

If you have loans or owe money on credit card it’s a good idea to pay off the debt that charges the highest rate of interest first. Store cards for instance are notorious for charging very high rates of interest and you may well find yourself a lot better off by consolidating your debts into a personal loan from the bank.

In most cases it pays to prioritise paying off debts over saving, unless you’re locked into a loan with an early-payment penalty, or you have interest-free debts.

We’d love to hear from you
Are you savvy when it comes to stretching the household budget? We’d love you to share your tips.

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My biggest money saver this year has been my energy supplier move. I moved from Scot Power to Bulb and now saving so much money p/m my Xmas is almost paid for! Bulb are so much cheaper and they pay your exit fees to join, so you could move now before the big chill starts and heat your home for less, takes just 3-4 wks. You can also get £50 credit with the link. They are 5 Star Trustpilot rated too! SP are awful..Oh and they are renewable & do all the work ;-) bulb.co.uk/refer/elizabeth407

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Sarah100

Sarah100

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I have seen this formula on American web sites and they say that the 50% covers housing costs, eg rent rates and the 30% discretionary includes food, heating, utilities and travel to work costs. That is because eating must be a luxury and discretionary! The twenty percent is for paying down debt. However this still does not work well.

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Such a good idea but not realistic, when you're on the breadline you're already meeting only the essentials. Oh to be able to save!

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It is a nice article. very helpful

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Good idea but unrealistic. If you essentials are only at 50% then I'd say your living a quite cushy lifestyle compared to mine. My bills come up to at least 80% and the rest is used for debts. I have no spare money whatsoever and have to find free things to do with the kids. Just totally unrealistic for a lot of people.

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