Five (relatively) easy ways to save money in 2021
If you’ve set any financial new year’s resolutions, saving money might be at the top of the list.
You know you need to put some money aside each week... But how? There are really only two ways to save: Earn more money or spend less of it.
If you’re focusing on the latter, here are five (relatively) easy ways to help make it happen.
Check your utilities and mobile phone
The power, broadband and mobile markets are competitive ones, which helps people who want to shop around. If you haven’t looked at your accounts for a while, check in with your provider to see if you could be on a better deal. Threaten to switch and see if they can sharpen their prices. If not, shifting between companies can pay off – you can often get a credit on your account as well as a cheaper electricity rate. The number of households switching power companies is near record highs – there were nearly 40,000 switches in October.
Take your phone
Don’t go to the shops without your phone so that you can quickly Google prices before you purchase. It’s easy to shop around online and shops will sometimes match a better price on an item. Sites such as PriceSpy give a good overview of what products are selling for. Liisa Matinvesi-Bassett, country manager for PriceSpy, says not all deals are what they seem. PriceSpy data shows that while the Apple Watch Series 5was 11 per cent cheaper than usual on Black Friday at $607, the time to buy was in September, when the price dipped to $479.
Check subscriptions
You can get everything from magazines to toothbrushes on subscription these days. While that’s good for taking away the hassle of having to remember to purchase, it means the payments sometimes keep going out of your account long after you’ve stopped getting a benefit from the product. Take stock of your subscriptions and put some on hold, or cancel them.
If you have rules and stick to them, it cuts down the amount of thought you have to put into your spending decisions.
Make some rules
If you need to cut down on your spending, it can be helpful to set some mental rules to live by. That could be something like not spending more than $100 on one purchase without giving yourself a day to think about it or not spending more than $50 a week on workday lunches. If you have rules and stick to them, it cuts down the amount of thought you have to put into your spending decisions.
Related to this, adopt ameal planning mindset and do one supermarket shop a week or fortnight to purchase the ingredients you need. Financial adviser Liz Koh says that after rent and mortgage, most people’s biggest expense is food.
‘‘There is a huge amount of discretion in how much you spend on food and it’s possible to make substantial savings through having a strict budget for food.’’
Pay yourself first
If you decide you’ll save whatever is left over at your next payday, you may be disappointed. Saving tends to be more effective if you work out what you can afford to put aside, and then transfer it to your savings as soon as it arrives in your account. Automating the process and removing the chance to think about it makes success more likely.