15 small changes that could kickstart your savings habit
Written by Tom Henson on January 24, 2018.
In my last post I talked about the importance of saving. I do understand that many people’s budgets are stretched with little disposable income leftover to save but small changes can add up and free up cash to save, even if it is a small amount to start with. Something is always better than nothing and you might find that seeing your savings adding up will inspire you even more.
The key is to keep the money that you save separate from your everyday finances so that you aren’t tempted to dip into it. That’s one reason that a regular savings plan is a good idea. The other reason is that compound interest works its magic on your savings so that they grow year on year and at much better rates than you will get in the bank.
Here are 15 small changes that you can make in order to have something left at the end of the month to save. Adopt some of these as regular habits and you won’t even notice that you’re having to cut back.
1. Compare insurance
It’s dull but it can bring big savings. Compare what you are paying to other options and if it makes sense, switch insurer for your car, home and medical insurance.
2. Cook at home
Eating out is lovely but it is an expensive luxury. Try cutting out just one meal out per month, or more if you can.
3. Take your own lunch to work
A basic combo meal in a fast food restaurant in Kuala Lumpur costs RM14. If you buy a comparable lunch every working day in a month, that adds up to around RM280 (US$70) every month. Bringing your own lunch from home will be significantly cheaper.
4. Give up the morning coffee
The same maths can be applied to a takeout coffee, with a Starbucks cappuccino costing around RM14. Stick the kettle on at home or work and invest in a travel mug.
5. Buy own brand products
The difference between own brand and generic products is often just the marketing. While you might have certain non-negotiables (lots of people don’t like non-branded cola for example) there are many products where you won’t even notice a difference.
6. Stop drinking alcohol during the week
Your liver will thank you as much as your wallet!
7. Cancel the gym membership
Switch from being a gym bunny to exercise that doesn’t cost anything like running, cycling (if you have a bike) or anything from yoga to cardio workouts on You Tube.
8. Freeze your credit cards
It might sound drastic but it will stop you taking them out and making unnecessary purchases and if you have to defrost them to use them it might make you think twice about that online shopping binge! Keep your cards for emergencies only.
9. Stick to cash
Whereas often purchases on credit or debit cards don’t feel ‘real’ there’s nothing like having to hand over actual physical money to hammer home just how much money you are spending. Many people find a cash-only policy reduces their expenditure.
10. Switch the cinema for movie nights at home
Make your own popcorn (which will save you a small fortune alone), hunker down on the sofa and watch a film without being bothered by the giant sat directly in front of you or the whispering couple behind.
11. Apply the 30 day rule on purchases
How much do you REALLY need that pair of shoes? Make yourself wait 30 days before buying them and see if they still seem such an essential purchase. Chances are there that they will turn out to be not quite so indispensable after all!
12. Use your local library
Libraries are an under-used resource these days when it is so easy to download a book on to your Kindle. And they can offer so much more than books. In many you will find audio books, newspapers, magazines, films, music as well as free events, workshops and job hunting resources.
13. Cut food waste
An inquiry into food waste in the UK found that in 2015 the average household lost £470 a year because of avoidable food waste, whilst those with children incurred a loss of £700. It’s well worth putting some effort into reducing waste by only buying what you need and learning how to make the most of leftovers.
14. Sell unwanted items
I bet there are loads of things lurking in your home that you never use – the bike your child has grown out of, that smoothie maker that seemed like such a great idea but in reality merely gathers dust on a shelf, unwanted toys …. One man’s trash is another man’s treasure so have a look at what you might be able to sell and how. There are loads of online sites for selling secondhand items or why not hold a yard sale?
15. Take your own food on journeys
When you’re travelling it is all too easy to fritter away a ton of cash on buying drinks, snacks and meals at airports or service stations. Plan ahead and bring your own snacks and always carry a refillable water bottle (which is better for the environment too).
Even though we're already in the new year, it's never too late to make a resolution - especially when it comes to your finances. Why not make it your resolution to take a couple of these money saving ideas on board? If you’d like to find out more about our regular savings plans and how they could help your money grow in 2018 why not get in touch with me at firstname.lastname@example.org.