As financial planners, we know the cost of living crisis is really starting to bite at families budgets, so we wanted to share some useful tips we often discuss with clients to save money. The key theme is always looking at your budget and deciding what’s essential, and what’s not…
- Account Fees – Are you paying an account fee for services you don’t need? Some bank accounts charge a monthly fee and in exchange provides a number of services such as phone insurance and breakdown cover, do you need these, are you already paying for them elsewhere?
- Overdraft Fees – Often with business accounts, bank change an annual fee to have an overdraft, if you’re not using it and have emergency funds elsewhere, consider whether this is value for money…
- Switch – Some banks are now offering to pay you if you switch bank accounts, I know the thought of this can be painful, but with the switching guarantee it can be easier than you think, plus you could pick upto £170 to do so!
- House insurance – If you’ve been with the same insurance company for a number of years you could be paying over the odds, even if your policy is not up for renewal you could find a cheaper deal elsewhere, just make sure you check for any cancellation fees with your existing provider.
- Review what’s essential – I have a big fear at the moment that people are cutting back on costs and potentially not thinking through what’s essential or not, I’ve seen people cancel life assurance policies rather than film subscription services, you need to bear in mind what’s important to your family, if in doubt speak to a good independent financial adviser.
- Cashback – Are you making the most out of your spending? Many credit card providers now offer cashback on your regular spending to earn points or vouchers, just make sure you pay off your credit card in full each month to avoid interest charges. Some banks also team with companies to offer discounts that can be activated, make sure you check them out!
- Balance Transfers – It’s something many of us know about, but it can be overlooked, could you save interest by transferring a credit card balance to a new card? Some providers are now offering interest free periods of over 2 years.
- Interest Rates – Recently we’ve seen a number of Bank of England base rate rises, which means cash is starting to earn a little more on deposit, so make sure you research for the best rate. Just remember, make sure any bank you save with is covered by the Financial Services Compensation Scheme (FSCS).
- Mortgages – Is your mortgage deal coming to an end, or are you on a variable deal? If so make sure you get yourself a mortgage review, ideally from an independent mortgage adviser who can search the whole of the market, it’s worth noting what your existing lender will also offer you to stay, so you can compare.
- Working from home – If you’ve been working from home you could benefit from certain tax allowances, visit the HMRC website but in summary:
You can either claim tax relief on:
- £6 a week from 6 April 2020 (for previous tax years the rate is £4 a week) – you will not need to keep evidence of your extra costs
- the exact amount of extra costs you’ve incurred above the weekly amount – you’ll need evidence such as receipts, bills or contracts
You’ll get tax relief based on the rate at which you pay tax.
This article is for information purposes only – should not be perceived as financial advice.