8 Ways to Cut Down on Your Expenses
Understanding your monthly outgoings is key to reducing expenses. Small, often overlooked costs can add up to have a big impact on your budget. By being mindful of your spending, especially on daily necessities and leisure, you can easily discover opportunities to save.
Here are eight different ways you can cut down on your monthly outgoings:
1. Lower your heating by just 1°C
As energy prices continue to rise, making your home as energy-efficient as possible is not just an ecological choice, but a financial necessity. One of the simplest steps you can take is to adjust your thermostat. Here’s how a small change can make a big difference:
- Research by Ideal Home discovered that lowering your heating thermostat by just one degree (from 19°C to 18°C) can result in annual savings of around 1,530 kWh per household. This could translate into £140 saved on your annual energy bill.
- University College London believe that larger homes could save even more, saying that for every square meter, there’s an average saving of £1.10 on gas and 40p on electricity with each 1°C decrease in your thermostat setting.
2. Save money on your water bills
A lot of people don’t think too much about their water bills because they see them as fixed, but there is actually room for savings. By introducing a water meter, you can cut down on our water usage and, as a result, your bills. On average, people with water meters use about 31.7% less water compared to those on a standard rate. While this doesn’t translate directly to a 31% discount, It can still lead to significant financial benefits over time. This online water meter calculator can help you estimate the potential savings from making the switch to a metered supply.
The Energy Saving Trust say that the average UK household uses roughly 345 litres of water per day. By implementing water-saving devices, such as a cistern displacement device, you can cut down on the volume of water used per flush, reducing your water bill even further.
3. Cut down on your food expenses
With food costs claiming 16% of a UK household’s budget, smart food budgeting is essential. Prices have surged, with a 12.2% increase over the past year alone, making it more important than ever to be mindful about how you shop for food.
Here are five ways to cut costs on your food expenses:
- Try cutting down on meat: Oxford University’s research shows that switching to a vegan or vegetarian diet could slash your food bill by up to one-third in the UK.
- Use a deals app: Compare prices across major UK supermarkets and access the latest deals and freebies to save on your weekly shop.
- Stick to own brand: The British Nutrition Foundation suggests that supermarket own brands are almost always cheaper than branded products, without compromising on quality. Furthermore, shopping at local markets and independent stores can also lead to impressive savings.
- Stock up on canned fish: Canned oily fish like sardines and salmon are not only more affordable than fresh fish but also have a much longer shelf-life while still containing important nutrients like omega-3 fats and vitamin D.
- Frozen foods: Frozen fruits and vegetables are almost always less expensive and can even be more nutrient-rich than their fresh counterparts. They also contribute to reducing food waste as you can use only what you need.
Bonus tip: You could always deposit the surplus savings into a Metro Moneywise savings account, where it could earn annual dividends and provide a safety net for a rainy day or unexpected event.
4. Cut down on your subscriptions
These days, we are no strangers to subscription services, with over £20 billion spent in the UK annually. An average individual pays roughly £500 a year, and the cost is even higher for those with multiple subscriptions. It’s been found that a significant amount of this spend—half a billion pounds—was on subscriptions that auto-renewed without the customers even realising.
Here’s how you can reclaim control over your subscriptions:
- Check regularly: Half of the young adults could save about £192 annually by cancelling unused subscriptions. Regular checks can prevent money from slipping away on services you no longer use or care about.
- Legislative support: New laws aimed at helping consumers cancel unwanted subscriptions could save an average of £290 million a year over the next decade.
- Read the terms: Understanding subscription terms is crucial. Knowing exactly what you’re signed up for—including fees, duration, and billing frequency—can prevent surprises and save money in the long run.
- Take it slow: Look for services that offer straightforward cancellation policies. The easier it is to cancel a service, the less likely you are to continue paying for something you no longer need or use. Most companies offer a discount for an annual subscription, but sometimes it might be worth paying monthly for a short while until you’re certain you want to commit to a longer term agreement.
- Set reminders: Set reminders for subscription renewals. Then a few days before you auto-renew you’ll get an alarm on your phone, giving you the chance to opt out before they lock you in for another term.
5. Cut down on your transport costs
Vehicles are often one of the most significant expenses for UK households.
Here’s how to cut down on your commute:
- Cycle to work: Cycling to work is not only beneficial for your health but also for your wallet. The upkeep of a bicycle is far cheaper than the costs associated with running a car, making every trip to work a chance to save money.
- Car clubs: If you don’t drive often, you could look at joining a car club. With car clubs, you can hire a car by the hour or day, and with vehicles readily available in many cities, you could save over £3,000 annually compared to owning a car.
- Car sharing: Sharing a ride with colleagues or neighbours can cut your commuting costs in half. Many companies support car sharing schemes, which can be particularly cost-effective for regular commutes.
6. Save money on your clothing
Over the last few years, we have seen a shift towards more conscious fashion consumption habits. Over half of UK shoppers are now buying more secondhand clothes to save money amidst rising living costs, with potential savings of up to 25% per item when shopping secondhand. This amounts to an average saving of £185 per year. There is a growing trend in the UK of people making additional income from selling their used clothes, making an average of £350 annually from items that would otherwise go unworn.
Buying clothes off-season can also lead to big discounts. For example, buying summer clothing at the end of August, when retailers introduce autumn ranges, can result in savings as these items are often sold at a fraction of their original cost.
7. Find a budgeting strategy that suits you
Mastering your personal finances is an ongoing journey, with new strategies constantly being developed. Here are three useful budgeting techniques that might work for you:
Money Dashboard offers a holistic view of your finances by aggregating all your account information into a single dashboard. It categorises transactions automatically, making it easier to track spending and identify areas where you could potentially save.
MoneySavingExpert’s Budget Planner:
This method involves a comprehensive approach to budgeting, where you start by collecting all your financial documents, such as bank statements and bills. You then input these details into a specially designed spreadsheet, which helps you scrutinise every expense and streamline your savings plan.
This technique is ideal for people seeking to refine their spending habits incrementally. It involves reviewing and adjusting your previous month’s budget to better fit your current financial situation, allowing for a more responsive and dynamic approach to managing your money.
Bonus tip: Starting with your biggest debts is a wise strategy when creating a financial plan, as it can minimise the amount of interest paid over time. If managing multiple debts becomes overwhelming, a debt consolidation loan could simplify your financial situation. Metro Moneywise provides a Debt Consolidation Loan that can help you streamline your monthly payments and save money in the long run.
8. Join Metro Moneywise Credit Union
Reducing your expenses doesn’t have to mean sacrificing quality of life. It’s about making smarter choices and choosing the right financial tools and advice that suit your situation best. At Metro Moneywise, we’re not just a credit union; we’re a community dedicated to supporting our members through every financial journey. Our range of safe savings and affordable loans are designed to support you in achieving your financial goals.
Contact us if you would like to know more about how we can support you on your financial journey.