We know that times are tough right now and many of us are feeling the pinch. With daily living costs rising it can be hard to see how to reduce debt and build up a buffer of savings, especially when it can feel like you need to take a loan out just to pay for your weekly groceries. In 2022 we put together a post about ‘How to Make Major Savings at Home’ with tips to help make daily savings with your groceries, utilities and smaller luxuries.
Now to add to this, we’ve asked the team for some of their top money saving tips to help you get ahead in 2023. Pay Back Any Short-Term High Interest Debt First
If you’re wondering which debt to pay back first then we recommend paying off your highest interest debt first. It will be costing you the most and it can feel discouraging when you’re making monthly payments that only cover the interest not the debt itself. It might mean you have to reduce payments on other debts down to the minimum payment, but then any extra money left over can go towards tackling the high interest debt. Once this is done you can then direct your focus to other debts or to building up your savings.
Make Fortnightly Mortgage Repayments
Rather than making monthly mortgage repayments, if you can, swap to fortnightly mortgage repayments. With 26 fortnights in a year, you will be paying back capital on your mortgage more often, reducing your mortgage balance, and, as a result, saving you interest.
Use Supermarket or Service Station Loyalty Cards
Whether it’s air miles, free coffees, savings on your weekly shop, points to use in store or money off fuel, loyalty cards are a rewarding way to make your dollars go further. They’re especially useful in places that you use frequently like supermarkets but if they’re free to join and don’t require a minimum spend to use then they’re worth signing up to, even if it’s not for a regular haunt.
Pay Your Rates Regularly Rather than waiting to pay your rates every six months or annually, make regular payments. When setting up a direct debit online you can choose to pay as often as weekly. By making regular payments by direct debit you’re not only likely to avoid late payment penalties but you can also build it into your monthly budget rather than being hit with a bigger lump sum.
Say Goodbye to Buy Now Pay Later Apps By spreading the cost out over six weeks, apps such as Klarna, LayBuy and Afterpay are just encouraging impulse shopping. If you had to cough up the full amount for that watch in one go would you actually have bought it? Whilst they don’t charge interest you can be charged for late payments, it might seem staid but rather than frivolously spending, save up first and only buy it once you have the money. In that time you might realise you don’t really need it after all anyway.
Need help with your business accounting? Get your business finances working for you by getting in touch with Grace Team Accounting. Call us on 07 578 5416