Money Saving Tips

Whether times are good or bad financially speaking, there is rarely any valid reason to waste money by paying more than is necessary for products and services. It is equally unnecessary to have money tied up uselessly.

Many people are surprised at how much money they can save, and how much money they can ‘free up’ by progressing a few basic ideas that are both good for the pocket and in some cases, good for the environment also.

Manage the consumption of heating energy.
Whatever the fuel source is, fuel is expensive. The advantages of insulation and energy efficient boilers are well known, but is it necessary to heat the house to T-shirt level? Turn the thermostat down a degree or two and put on a jumper – the savings will be significant over a winter.

Shop Around.
There is something to be said for convenience but don’t give in to the siren-like calls of that one big shop just down the road. Be prepared to walk around a little to compare prices. Even easier, use the Internet or phone to compare prices on those slightly bigger purchases. The savings can be dramatic.

Negotiate!
Many people in the UK find haggling and asking for discounts to be something of an embarrassment. This is completely different to many other European countries where the first asking or ticket price is rarely paid. Sometimes asking for that deal or reduction can save a small fortune. Be prepared to haggle and if necessary, to walk-away and go elsewhere.

Buy through the Internet
The Internet is not only useful for comparing prices of products on the high street, but purchasing items through the Internet can also save large amounts of money. Many retailers will offer significant discounts for on-line purchases, as it is far cheaper for them to sell online than through a normal store.

Make more food.
The cost of ready-made meals (lunches, take-aways etc) can be very high when checked against what is actually in the package. Convenience is fine, but buying fresh food and preparing more lunches and meals will save a lot of money each month and very possibly be healthier.

Throw Away Less.
Instead of having that quarterly ‘trip to the tip’ to clear out the garage or loft, consider instead how much of it could be sold. These days it is very easy to sell surplus items through websites such as Amazon or EBay etc. The prices received may not always be high, but again over a year they could mount up. Or why not do a boot fair?

Buy in Bulk.
In many areas of life such as foodstuffs, DIY materials and household goods, it is always possible to buy at huge discounts if buying in bulk quantities. Contact neighbours and families to form a ‘purchasing association’ and make these sorts of purchases in larger quantities. The savings for everyone will be very worth having.

Leave The Car At Home
Cars are VERY expensive to run and a massive cost component in the budget of many families. Statistics also show that the vast majority of car journeys are short hop ‘convenience’ journeys to the local shop etc. Try walking or using a bicycle. This will also be healthier.

Check Baseline Household Costs.
In the modern world there is ferocious competition between utility companies (phones, electricity etc) and as a result, some staggering deals to be had. This is also true in financial services covering things such as your household, car insurance or savings policies etc. Check around to see what these are and be prepared to change supplier – it is easy.

Increase DIY.
Many minor jobs around the home do not require a specialist tradesperson. Labour costs are expensive and if it can be safely done on a DIY basis then the purchase of a good DIY book and the liberal use of some elbow grease could save a lot of cash!

• Lots of money can be saved in day-to-day life
• Shop around
• Don’t throw things away but sell them instead
• Be prepared to do more yourself.

Is your money safe?

Savings and other bank accounts by British depositors are guaranteed by the government-backed Financial Services Compensation Scheme up to the figure of £50,000. Despite the recent international crises in the financial world, therefore, for the overwhelming majority of this country’s population, your money is remarkably safe.

Although the most recent figures available relate to 2007, the British Bankers’ Association estimate that only 2% of bank accounts held in Britain contain a balance of more than £50,000 and only 4% show a balance that exceeds £35,000 (according to a report by the BBC on the 30th of September 2008). 98% of all deposits, therefore, are safely guaranteed by the Compensation Scheme.

The introduction of such guarantees was not simply the result of the government looking to protect individual savers, however. It was prompted just as much by the finance industry’s desperate need for the capital represented by so many individual savings accounts. In this regard, banks and building societies have found themselves to be between something of a rock and a hard place.

They still desperately need savers’ deposits. But in order to encourage lending between themselves and to individual customers, they also need interest rates to be low – hence the Bank of England’s drastic one and a half percent reduction in its base rate during the final quarter of 2008. The deposit-takers, therefore, are being pulled in opposite directions. On the one hand, interest rates need to be sufficiently competitive to attract the savings so desperately needs; while those same interest rates also need to follow the underlying trend of the Bank of England base rate. The guarantee to individual savers – the guarantee that makes your money safe – is one of the principal factors in helping to maintain competitive rates for savers.

This is reflected in the way many banks and building societies have actually behaved in recent months. Immediately after the announcement of the 1.5% reduction in the base rate, for example, many savings accounts (especially those offering a fixed rate of interest) were withdrawn from the market. In the aftermath, however, the same banks and building societies had little option but to reintroduce new accounts and new attractions in order to attract the savers’ funds necessary to underwrite their balance sheets.

Although there has been an inevitable period of re-pricing, therefore, banks and building societies remain just as desperate for depositors’ cash and have to offer attractive rates of interest in order to get it. As ever, of course, the longer they get to keep such deposits, the more attractive the rates they are prepared to offer. Many fixed-rate savings accounts, which savers agree to leave on deposit for an agreed term (typically for a year), thus, continue to offer a good deal.

Moreover, they represent a good deal for both the banks, which receive the funds they need to stay in business, and the individual customers, who earn not only an attractive and competitive rate of return on their savings, but also enjoy the comfort of knowing that their money is safe.