If you want to have some savings behind you then you may wonder how much money you should be saving each month. It is wise to transfer some money when you get paid into a savings account so that you know that you will always automatically do it and you will; know the money is available to do so. It is a good idea to do this because otherwise you could find that you will not have enough money left at the end of the month to do it because you have spent it. So, doing it first means that you will have to budget so that you can manage without this money. If you calculate things properly you should know how much you will be able to save. It is not always easy to get it right, but you can do some calculations which might help you.
Work out How Much You Earn
To start with you will need to know how much money you have coming in each month. This should be fairly easy to do as you are likely to have just a few or even just one income source. So, this will include any salary that you earn, any benefits you get, child maintenance payments, interest, pensions and things like this. It will be easier if you know how much it is after tax too, or else you will have to work out how much that is and take it off.
Work Out How Much You Spend
This will be a trickier thing to do because you will have a lot more things that you will pay for. You will find that there are certain items that you pay for regularly every month, but there will be some things that you pay for less often. This makes it tricky to work out what you spend, but it can be best to work out an average. Then you will have a figure that you will be able to use.
Decide What to Save
At this point you should be able to take away the amount you spend form the amount you earn and see what is left. This figure will be the amount that you can afford to save. However, you may not want to save it all as you may want some for overpaying debts or other things. If you tend to find that you are spending more than you earn, then this could be a much trickier decision. It is good to discover that this is happening as you should be able to do something about it and change what you are doing to make sure that you are not overspending each month. For example, you could look carefully at your spending and see whether you are paying too much for things and therefore can switch to cheaper items or you might want to buy less items or look for opportunities to earn more. Once you are earning more you are spending you will be in a position to save.
If you are putting the money in an instant access account then it will not matter if you save too much. If you find that you need the money then you will be able to get it back out of the savings account. However, if you are tying the money up in a notice account or bond then it is a good idea to think hard about whether you should put all of your money in there and not have anything to fall back on, in the case of an emergency.
It is a good idea to review the situation every so often. You will want to check whether you are putting in the right amount of saving according to what you can afford. You could find that you will still have some money left and so perhaps you should put a bit more in or you could find that you are struggling to manage so you will need to take some out. It is wise to review this every few months, at least to start with so that you know that you have chosen the right amount.Read More
All of us have to buy food and it is often the case that we will find that we spend a lot of money on it. Although these days, we spend a much lower proportion of our earnings on food compares to previous generations, we may still feel like we would like to find a way to reduce the cost of the food that we are eating. There are things that we might be able to try to help with this.
The first thing that you could consider doing is switching to a cheaper supermarket. We all know that there are the higher end places such as Marks and Spencer and Waitrose and the lower end ones like Aldi and Lidl with others in between. We could probably work out a hierarchy of where they stand price wise. It is therefore worth thinking about whether you could change to a different supermarket and save money. It is worth being careful though as sometimes, we may not be right about which is cheaper. This is because it will depend on exactly what we buy. So, make sure that you do some price comparisons to check that you will be saving money. Also think about the distance that you are travelling and whether you have to allow for the cost of extra petrol or public transport costs.
It can be worth checking whether you could switch brands on some of the things that you buy and save some money. You could find that you are already buying the cheapest, but there may be some items which you could buy for less money. You may find that they are not so nice and so you will want go back to what you were having before, but you may also be surprised and find that some of the items will be as good or even better and you will want to stick with them. It can be well worth trying, particularly with items that are expensive as you may be able to make bigger savings on these.
Buy Less Luxury Items
Although food and drink are essential, we still tend to buy luxury items in this category. For example, we may buy alcohol, fizzy drinks, sweets, snacks, puddings, cakes, biscuits, ready meals and things like this which are actually not necessary for us to eat. Obviously, we do like them and the idea of cutting them right out can be rather daunting. However, cutting back on these items could not only save us money, but also help us to be healthier at the same time.
Buy Less Items
We may also just be able to cut down on the quantity of food that we are eating. Perhaps having less food on our plates could help us. Obviously, this will depend on whether we normally pile up our plate or eat a small amount of food anyway. We should also be careful though, that we are not buying food and then letting it go off. This can cause problems because you will be spending money on items that you might be throwing away. So make sure that you only buy what you know that you will be able to use.
These changes will add up. So, if you choose a few things to try, you could find that you can make quite a difference to your food bill. Some will be harder than others, but you will be able to choose the ones that you feel will be the best for you to suit you and your lifestyle and that will make the most significant difference.Read More