How to save when you don't have much money

The cost of fuel - up.

The cost of food - up.

The cost of everyday bills - up.

With the cost of living seemingly increasing by the day we all need to get into the savings habit. Whether it's to pay for Christmas, to replace a broken electrical item or to see you through the unexpected, having a savings buffer in place can be a lifesaver.

However, how do you even start saving if you have little money? We've put together five helpful tips which could see the pounds come rolling in...

 

Tip 1 - Cut the cost of living

In order to save you need to free up some money each month. The easiest way to do this is to cut how much you spend on your utility bills – so see if you can save money by switching providers.

With energy price rises, your fuel bills are a good place to start. Some people can save over £400 a year simply by switching their energy provider, so you owe it to yourself to check.

You should also check and see if you can pay less for insurance (on everything from your car to your holidays), as well as cheaper phone and broadband. These are all regular bills for which you may well be paying over the odds for. Also, remember to haggle when you come to the end of a contract - companies need all the business it can get these days, so see if they will knock off a few pounds per month, it all adds up!

Why not find out how much you could save in our financial help section. There you will find links to lots of helpful price comparison websites.

 

Tip 2 - Cut down on your general spending

You can save money very easily by cutting down on your everyday spending. If you don’t know where your money is going each month, why not keep a spending diary for a few weeks - you’ll soon find out!

A good place to start is by cutting down on just one thing – perhaps you buy a paper every morning? Replace that by reading your news online and you'll save £2.50 a week. This may not sound like much but it means you will save yourself £130 a year!

When it comes to your grocery shopping, why not drop a brand? More often than not the cheaper brands are tastier than the more expensive ones.  

 

 

Tip 3 - Find money you didn’t know you had

Thousands of people across the UK have no idea that they could have money sitting in an account they may have forgotten about. Be sure to check out the brilliant website MyLostAccount, which will search for any dormant accounts you might have forgotten about.

While you’re at it, why not pull the cushions from the sofa and check in pots, on shelves and under boxes around your home to see if you can find any spare coins? According to Visa UK, there is approximately £1 billion of loose change just lying around across the country!

 

Tip 4 - Save coins in a jar

Pick a coin – any coin. It could be a £1 coin, 20p, 10p or 2p. Whichever you choose, set yourself a challenge and remember to save it at the end of each day. Get yourself a piggy bank or a special jar that you empty your coins into regularly.

A lot of people use this method of saving for things like a holiday or Christmas. It’s a great way of gradually saving money without it hurting your purse too much. Saving just one 20p piece a day over one year would see you save £73.00!

 

Tip 5 - If you’ve got it, why not sell it?

What have you got hanging around the house that you no longer need or use and could make you some money?

Set yourself a task of clearing out anything you don't want or need and sell it on. Websites like eBay and Gumtree are great places to advertise your unwanted items online. The website Car Boot Junction will show you the nearest car boot sales to you. 

 

As you can see, it doesn't take much to get into the savings habit. Just taking some time out to work out where your money is going and making a few small changes here and there could see you make some significant savings.

Good luck!

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Last updated: 18 January 2012