• Ellie

A quick guide to reducing your expenses with ease

In 2020, we’re bombarded with content left right and centre, which makes it so easy to keep saying yes to added extras that we didn’t ever know we needed. Before you know it, your monthly expenses can spiral out of control and leave you with pennies at the end of the month, along with a lot of overpriced and underused services you’re paying for.

The good news is that you don’t have to simply stick it out and pay over the odds for months on end. With a few quick and simple steps, you can give your expenses a makeover and bring back some of that bank balance.

Step One

The first thing you need to do before you start organising your expenses is to know what you’re currently spending. Download your last three bank statements so that you’ve got all of the information in front of you. That’s the first big step done!

Step Two

Now, go through your statements with a fine toothed comb. Identify any items which you can’t initially recognise, as a lot of payments will appear as the payment company rather than the item or service you’re paying for. Be sure to leave no leaf unturned and account for every penny you’ve spent.

Highlight all of the different expenses and categorise them. Note down whether they are essential bills, expenses that you benefit from, or those pesky costs that you forget you’re even paying for and don’t use.

Step Three

Decide which expenses you can cut out for good. There will probably be a number of expenses that fall into the ‘forgotten costs’ category which are the starting point. Call up the service providers or check out the cancellation policies online. For many subscription-based services today, you can cancel with short notice, so check the date that the cancellation will take effect.

Step Four

With the expenses that are essential bills or that you benefit from using, such as Spotify or your gym membership, have a look at ways that you can cut down the costs. To find a better tariff for your energy bills, a great place to start is Cheap Energy Club from Money Saving Expert. You can also use comparison websites to find deals to switch and save a lot of money.

Step Five

The final step is to set reminders for when any promotional rates or contracts expire, so you can call up and negotiate a new rate or leave your existing provider for another competitor. One prime example is your phone network - if you don’t cancel a contract when it expires, you’ll automatically roll on to a new contract and continue paying over the odds. Call up your network a month or two before your contract expiry date and you can save yourself hundreds.

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 TGTM provides information & articles for educational purposes only & is for general information only. In particular, the information does not constitute financial advice. or any form of recommendation & is not intended to be relied upon. For specific advice, please speak to an independent financial advisor.