The vagaries of the economy that have created global stock market unease over the last few years are by no means over, and many British households are still feeling the pinch.
There are plenty of ways though for you to save money in 2016 – here’s some good places to start…
Open an ISA
If you’re new to the concept, you may be wondering what does ISA mean? Don’t worry, there’s so much jargon in the finance sector and it is always fine to question definitions.
ISA stands for Individual Savings Account, but what it actually means is that the interest you earn on the money you put into it, up to a maximum of £15,240 annually at the moment, is tax-free.
Setting up an ISA is very easy, with a large number of providers in the marketplace. There are two categories of ISA – Cash ISAs, and Stocks and Shares ISAs – and you can have one or the other, or one of each, splitting your allowance across them both. Although there are obviously inherent risks involved with investing in stocks and shares, there is no income or capital gains tax payable on your profits.
Between these two categories there are many different types of ISA available, including new Help To Buy ISAs that allow first-time buyers to put more money aside for a deposit.
If you have any money floating around, putting some of it into an ISA is a great way to make it work a little harder for you.
It’s not just when you’re buying big-ticket items such as a house or a car that your negotiation skills (if you have any!) can come in handy. While you won’t get very far haggling over a pint at the bar, for reasonably-expensive purchases such as white goods or a new coat, it’s always worth having a crack.
Tips for successful negotiation – do your research first. Arrive armed with the correct information about somewhere else in the close-vicinity where you can get the same item for less, and have proof. Ask to speak to someone in management before you begin negotiating – the till clerk almost certainly won’t have the authority needed to lower a price, so why waste your time?
Even if you can’t get any money knocked-off, with a little persuasion you might still be able to get some other valuable extras such as an extended warranty, a year’s free insurance, or a free delivery thrown in.
Smarter Grocery Shopping
Food is obviously one of the biggest household expenses, so it’s naturally also the place where there is most potential for savings. Consider doing some or all of your shop at a budget supermarket such as Aldi or Lidl if there’s one near you, and switch to supermarket-owned brands from time to time, as the quality-difference is often barely-noticeable, whereas the difference in price can be huge.
Online shopping can highlight available discounts much more easily than pushing a trolley round the aisles and, if you have a bit of storage space, you can shop in bulk to save a few extra pounds over the course of a year. If you’re flexible on timings, you can often get free delivery too.
Never feel guilty about trying to get as much back from the supermarkets as you can. They employ armies of psychologists and other experts to help them persuade customers to spend more, and all sorts of sneaky tactics that, while perfectly legal, might surprise you.
Switch Your Energy Provider
Shopping around for your gas and electricity can save you £200 or more every year, according to Government estimates. Efforts to make it easier for customers to switch include encouraging new suppliers to enter the market, making switching faster – it now takes just over two weeks on average – and legislation that commits energy companies to make their bills easy to understand.
It should of course be a mantra to shop around for a better deal on pretty much everything, from insurance to bank accounts and hotel bookings. After all, if you could potentially save hundreds of pounds over the course of a year, isn’t it worth doing a little research now and again?
Assess Your Expenditure
Using your bank and credit card statements, and a spreadsheet, keep track of how much you spend on a weekly, monthly and yearly basis. Are you paying out for a gym membership you barely use? Could you use a different petrol station to fill up and save a few pennies a gallon? Is it possible that taking the bus or cycling to work could help you keep your motoring costs down? Have an audit and assess every single penny. You’re bound to be able to cut down.