Business and Finance
50 ways to save money in 2014
1. Take advantage of cashback and reward credit cards. Barclaycard’s Freedom Rewards card is giving £30 worth of vouchers when you spend £300 on the card in the first three months. Santander’s 123 credit card offers account holders 3pc cashback on fuel, 2pc cashback in department stores and 1pc cashback at supermarkets.
2. Recycle old mobile phones, DVDs, CDs and clothes. Mazumamobile.com is one of many websites you can use to sell your old mobile phone. It will pay up to £90 for a fully functional iPhone 4, or £30 for a faulty handset. MusicMagpie.co.uk will give you money for your old CDs, DVDs and games. You can also sell any unwanted clothes on the website, or alternatively, use sites like eBay.
3. Use comparison sites to find the cheapest supermarket prices. Mysupermarket.co.uk compares the prices of individual items at Tesco, Sainsbury’s, Ocado, Waitrose, Asda and Aldi so you can get the best deals. For example, the site today shows Hovis’ medium sliced soft white bread which costs £1.35 in Sainsbury’s and Waitrose, but £1 at Tesco.
4. Use balance transfer credit cards to transfer debt from your current credit card that charges a high rate of interest, to one that charges 0pc interest. Barclaycard’s Platinum credit card is currently offering 0pc for 30 months, with a one-off fee of 2.89pc.
5. Buy own-brand goods at the supermarket. Tesco’s Everyday Value baked beans in tomato sauce costs 24p for 420g. Heinz baked beans in tomato sauce costs 68p for 415g. Quite often, these non-branded options can taste better. Read our review of value-for-money tinned tomatoes.
6. Cancel your yearly gym membership and opt for monthly pay-as-you-go instead if there is a strong likelihood that you will stop going. A 12 month contract with Virgin Active costs £71 a month at its Tower Bridge gym, totalling £852 for the year. A rolling-month-by-month contract costs slightly more at £81 a month, but it can be cancelled at any time if you decide you no longer want to go. [Read more on gym contracts]
7. Bulk-buy foods that don’t go off, particularly if they are on offer. An open or unopened bottle of tomato ketchup can last up to a year in your cupboard, so if you go through a lot of it, bulk-buying would save you money. A 700g bottle of Heinz tomato ketchup costs £2.40 at Sainsbury’s, but Ocado is currently offering two of the same product for £4. If you bought four bottles on offer it would cost £8. If you bought four ketchup bottles seperately over the year – if it remains at the same price – you would spend £9.60.
8. Switch energy suppliers. Households could save up to £300 if they switch energy suppliers, but millions don’t. In fact, only 14pc of homes change their gas and energy tariff each year. The process is simple. You can check to see if you would save with our comparison tool.
9. Use discount websites to save on days out. Sites like groupon.co.uk, vouchercodes.co.uk and wowcher.co.uk offer daily deals and discounts on events, activities, travel and restaurants, to name a few. Tesco Clubcard is also good value when you use points to buy tickets for theme parks.
10. Cycle/walk to work (if possible) rather than drive or take the tube. Getting the bus will often save you money too, a single bus fare in London is £1.40 using an Oyster card whether at peak time or not. Travelling at peak time on the tube will cost a minimum of £1.60 one-way, and can cost up to £8.60. There is also a daily price cap of £4.40 on oyster cards when using the bus, meaning your third bus ride will cost 20p and your fourth bus ride will be free.
11. Grow your own herbs. Keeping pots of herbs in your kitchen can save you money on having to repeat purchase packs of herbs. A basil plant costs £1.25 at Sainsbury’s, and will survive as long as it gets sunlight and water, and is kept away from draughts in winter. A 28g basil bunch costs 80p from Sainsbury’s and will only last a few days. Growing from seed can be even more cost effective.
12. Pay less for your holiday in 2014. It’s wise not to rush in. Always check whether a special offer is being run through cashback websites, such as Quidco. It is offering 12pc cashback on hotels booked through Lastminute.com, booked in the next two days. Telegraph.co.uk/travel features some of the best value holiday deals for next year. Examples include a three night stay at the four-star Eurohotel Diagonal Port costing from £169 per person, including a return flight from Gatwick departing on January 20 2014.
13. Find cheap flights for your holidays next year. Look on sights like cheapflights.co.uk or skyscanner.net for the best deals. Make sure you delete your cookies (which can normally be found under Tools – Options on your browser) after visiting each site as prices often go up if you visit a website multiple times.
14. Rent a new dress rather than buy one. If you have a big event in 2014 but don’t want to fork out for a new outfit you’ll only wear once, there are a number of websites you can go to to hire a new dress, for a fraction of the cost of a brand new one. GirlMeetsDress.com has hundreds of dresses to search through, and for around £50 you can rent a designer dress (often retailing for hundreds of pounds) for two nights, or pay slightly more for seven nights.
15. Share travel to cut costs. You can join websites like liftshare.com or GoCarShare.com to meet other people who wish to share long-distance travel in order to cut costs. Drivers and passengers can benefit from travelling together, with the driver getting contributions for petrol costs, and the passengers saving on expensive train fares.
16. Open a savings account. Despite savings accounts paying paltry returns at the moment, if you have money sitting in the bank, opening a savings account can provide some extra income. The highest paying savings account on the market is currently Secure Trust Bank’s seven-year fixed rate bond, paying 3.52pc. Savers must put a minimum of £1,000 into the account, and will not be able to touch this money for seven years. On £5,000, savers would earn £1,072.88 in interest over the seven years (after basic rate tax is deducted). Alternatively, Principality Building Society’s five year fixed rate cash Isa is another best-buy account, at 3.05pc. Account holders can save up to £5,760 in a cash Isa without paying tax (for the 2013/14 tax-year) on the interest, so putting £5,000 into the account would earn savers £810.45 over the five years.
17. Go without a TV licence. A TV licence costs £145.50, but do you need one? If you watch catch-up TV you do not need a licence, so BBC iPlayer, Channel 4 on Demand and ITV Player are all free to use if you are watching shows that have already been broadcast. You also do not need a licence for watching DVDs and videos or to stream Netflix and Lovefilm. There are concessions in place for those aged over 74 and for partially sighted people. [Ask an Expert: Can I get a second TV licence for free?]
18. Use a slowcooker for cooking stews. Using a slow cooker to make a stew is both easier – you can leave it to stew while you’re at work all day – and cheaper. It costs around 10.5p to use a slow cooker for around eight hours, while using an oven will cost far more at 30p for one hour. [Full article: How much cheaper is a slow cooker than an oven?]
20. Check to see if your children are entitled to any benefits, including free school meals and uniforms for children. MoneySavingExpert’s benefits check up tool will tell you if you are eligible for any help. The information also covers carer’s allowance and other support payments.
21. Make sure your child isn’t paying tax on their savings account. Parents can save money into children’s accounts and earn up to £100 a year tax-free. However, HM Revenue & Customs automatically taxes every savings account at 20pc, regardless of whether tax is due. Children under 18 can earn interest before tax, but their parents must fill in a special form, called an R85. Form R85 stops 20pc tax being deducted at source, so the saver receives all the advertised interest. Call HMRC on 0300 200 3300 for more details.
22. Don’t buy bottled water, fill up a re-usable bottle with tap water. Not only is buying bottled water bad for the environment, it is also expensive. Lobby group Tapwater.org claims that the average UK consumer gulps their way through £25,000 of bottled water in a lifetime. Furthermore, an estimated 30pc of supermarket bottled water is tap water anyway. If you insist on buying it, we explain the cheapest way to buy bottled water.
23. Make your own drinks. Making your own juices and smoothies with a blender or juicer will save you the expense of buying these drinks in the shops. Sainsbury’s is selling Innocent’s 750ml strawberry and banana smoothie for £3. Sainsbury’s Basics strawberries cost £1.75 for 250g and its Fairtrade bananas cost £1 for 5. For a cost of £2.75, plus some for a small cup of milk, you can make your own version of the smoothie for less, and get double the amount.
24. Find the cheapest way to spend abroad. If you go on holiday in 2014 make sure you are careful with your overseas spending. Pick a credit card that doesn’t charge an ATM fee for withdrawing cash abroad (for example Halifax’s Clarity credit card) or use a pre-paid card like the one from FairFX.
25. Stock up on Christmas decorations now. Christmas themed wrapping paper and decorations went on sale around Christmas Eve/Boxing Day, so stock up now and save on the cost next year.
26. Have a dry January. If, according to recent figures from the Office for National Statistics, you are an average UK household that spends £15.20 a week on alcohol, by not drinking for the entire month of January, you could save over £60. One analysis even suggested a “dry January” each year could eventually add £20,000 to your pension, if saved.
27. Use supermarket loyalty cards. People are using their loyalty cards less, according to research conducted in August, but using a supermarket loyalty scheme could save you money on your weekly shop. Tesco’s ClubCard, Sainsbury’s Nectar Card and Boots Advantage card, among others, offer points for every item purchased in store. This is then turned into money off your next shop. Tesco, for example, offers customers one point for every £1 spent in store. Every point earned equates to 1p worth of vouchers, so 500 points will be exchanged for a £5 voucher.
28. Call premium phone lines from your landline. 0800 numbers will be free to call from mobiles in 2015, announced Ofcom last week. However, until that time comes, make all calls to premium rate numbers from your landline, as this is either free, or much cheaper. Calling 0871, 0872 or 0873 from a landline costs between 5p and 12.5p per minute from a landline and between 25p and 41p from a mobile. Calling 090 numbers cost between 10p and £1.65 a minute from a landline and up to £2.55 a minute from a mobile.
29. Use a spreadsheet to budget your household finances. Make a spreadsheet on Microsoft Excel totting up every household expense you will have to pay, including mortgage/rent, groceries, transport, utility bills, insurance, phone bills, and everything else, to ensure you don’t overspend. Google “house budget template” for more help.
30. Turn electrical appliances off when not in use. Last year, the Energy Saving Trust revealed that across the UK, households were spending between £50 and £86 a year on gadgets in a “non-active” or standby state, equivalent to 9pc to 16pc of the average electricity bill.
31. Use energy-saving gadgets to cut costs. A radiator booster for example, costs £25, but can cut heating bills by 10pc. Test labs have found the booster heats up a room more quickly than without it. For five more quirky gadgets that cut energy bills click here.
32. Swap books rather than buy new ones. Once you’ve read a book, you can swap it with someone else for a a book of theirs that you haven’t read yet, rather than paying for a new one. Readitswapit.co.uk has hundreds of thousands of books available for users to choose from. Alternatively, charity shop books are very good and of course, always check your local library or ask if they can order the book you want.
33. Pay your children to do jobs around the house. Get your children to earn their pocket money by doing their bit around the house. Cleaning the house/car, taking the bins out, ironing some clothes or walking the dog will save you money on professional help, and will teach your children the value of money. A study by the Royal Economic Society suggested it would make these children better savers in later life.
34. Make your own meals rather than buy take-aways. Save money on buying take-aways, which you can make yourself or buy from the supermarket much cheaper. A medium Margherita pizza from Domino’s costs £11.99, while a 250g Pizza Express Margherita pizza from Tesco costs £2.25.
35. Avoid the January sales. Even though you might feel like you’re getting a bargain, it is likely you are buying something you never really needed, and would never have bought in the first place had it not been on sale.
37. Shop at discount supermarkets rather than higher-end ones. According to a poll of 30,000 households, more than half shopped at either Aldi or Lidl in the three months to December. On current trends, German-owned Aldi could even overtake Waitrose to become the sixth biggest supermarket in the country this time next year. So why not join the masses to see how much you could save on your weekly shop?
38. Use coupons. A teenager from Essex recently found fame for “Extreme Couponing” which saw him pay 4p for a £600 shop at Tesco. [Read full story here.]
39. Rent out a spare room. Around 13.7m bedrooms in owner-occupied households across the country are currently lying “idle”, according to research conducted in June by flatsharing website easyroomate.co.uk, and renting out a spare room in your house could make you several hundreds of pounds each month.
40. Cut down on the cost of car insurance. Our consumer expert Jessica Gorst-Williams outlines 12 ways you can save on your car insurance, including increasing your excess and adding an extra driver on your insurance. [Read: A dozen ways to save on motor premiums]
41. Try and rope your neighbours into a “sharing economy”. Families can save hundreds of pounds a year by being part of the “sharing economy” which embraces everything from recycling second-hand goods through to hiring them out to other families on your street or “swishing” – hosting parties where guests bring a range of items to swap around. Celebrities including Gwyneth Paltrow and Sienna Miller host swishing events as means of charity fundraising. More: ‘Sharing saves us £20,000 a year’
42. Sell old comics, postcards and other investment pieces. If you have annuals hidden away in your attic, old toys stashed under your bed or music memorabilia tucked away in your garage, you could be sitting on a lot of money. Old Beano and Dandy annuals have recently fetched up to £20,000 at auction, Doctor Who daleks can sell at auction for between £15,000 and £20,000 and retro postcards could be worth up to £400 if you’re lucky.
43. Buy a ‘passive’ fund over an ‘active’ one. If you are an investor, buying a “passive” or “tracker” fund is typically much cheaper than buying tradiitional funds, as there is no need to pay a professional to manage your money. Numerous studies have suggested that vast numbers of professional investors fail to beat the average return from the market in which they specialise. Critics argue that random selection would be just as successful – and cheaper. For instance, a tracker fund might charge 0.25pc where an “active” fund might charge 1.7pc.
44. Collect loose change and pennies in a jar and cash them in at the end of the year. Without even realising you could have saved £40 or £50.
45. Get cashback for shopping online. Cashback sites like Quidco.com or Topcashback.co.uk give you cashback on your purchases once you have created an account with the respective site. You can browse High Street and online retailers using the websites and once you buy an item, you will receive a percentage of the value of your shopping as cashback which will be paid into your account.
46. Follow retailers on social networking sites like Twitter. Amazon, Asos, eBay and Debenhams are some of the retailers who tweet about their latest deals or sales on their website and in store.
47. Install a smart meter. Energy companies claim that the upcoming rollout of smart meters in 2015 will allow more accurate billing which will cut out overcharging, as well as allowing users to manage their electricity usage better – as the consumer’s energy usage is displayed on the screen. Half of smart meter users say they are now more likely to turn things off when not using them, so installing one in the new year might help you cut the cost of your energy bills. Phone apps can also help [Read: five apps to save you money]
48. Don’t waste food. The average UK household wastes £470 worth of food each year, or £700 for a family with children. This is equivalent to around £60 each month, says lovefoodhatewaste.com. The website outlines ways you can cut down on food waste, which in turn will save you money. Plan your meals, store your food correctly, get your portions right and eat leftovers are just some of their tips.
49. Switch to high-interest current account. If your bank pays a low rate of interest on your current account, opt for a better one. Nationwide’s FlexDirect pays 5pc on balances between £1 and £2,500, if paying in £1,000 each month. Clydesdale and Yorkshire banks pay 4pc on balances between £1 and £3000, if paying in £1,000 each month. Santander pays 3pc on its 123 Current Account on balances between £3,000 and £20,000, if paying in £500 each month. There is also a £2 monthly fee. And Lloyds and TSB pay up to 3pc on balances up to £5,000 if paying in £1,000 each month.
50. Say no to things you don’t need, can’t afford or won’t use.