Think Ahead And Budget - Keeping Costs Down*




I guess you could say that I'm someone who thinks with her heart, not her head. This isn't always a strength of mine, especially when I'm being over ambitious and listing my 'To-Do's' or New Year's resolutions. Usually by February I've let most of these disappear by the wayside and as frustrating as this is, it's reassuring to know that 80% of you do the same thing! One of the most common New Year’s resolutions is to cut down on spending, and although this sounds achievable, if you don’t budget or have a fully-pledged strategy in place, before you realise it you'll be six months deep into 2018 and no better off financially.

Obviously there is always going to be unexpected expenses. It's the way of life isn't it? Or as I always say, it's Sod's Law! It's usually car related or a broken home appliance and naturally this all adds up. But many of us also fritter money daily on little luxuries and on the one hand why not? We only live once right? However, if you are trying to build a back up fund or at least grow your savings then you do need to watch your spending. Just as an example, work out how much you spend on your lunch every day. You'll soon get a shock as you realise how much you spend over a twelve month period. The same goes for those who buy a coffee on their way to work each morning! 

Below you'll find a few suggestions on how you can make savings so that should you have any unexpected expenses you'll have no need to panic.

Travelling

Whether you drive or use public transport, the daily commute can (and does) cost us an arm and a leg. One suggestion if you do use public transport is to invest in a megarider ticket. This will enable you to travel as much as you want and you can tailor the ticket type according to your own needs. Whether you’re in need of a weekly bus pass for your travels or a monthly one, you'll soon find yourself making a huge saving in comparison to buying a ticket every day.

If you’re a driver it might interest and horrify you to know that the average motorist in the UK will spend an astonishing £168,880 over their lifetime. Bearing this in mind, perhaps it would be an idea to try public transport instead. With efficiency growing in this area all the time, there is no better time to make the switch. And just look at the positives! Not only will you be saving money but you'll also be doing your bit for the environment by reducing your carbon footprint. 

When it comes to payments across the year, apparently petrol now costs a driver £1,052.04. Servicing a vehicle can add up to £441 over a twelve-month period and this can change depending on the individual’s situation. MOTs can cost up to £168.46 annually and the cost of parking is also on the rise. With more vehicles now on the roads there seems to be a higher demand. Over a twelve month period a motorist can find themselves paying up to £145.80 for parking. When it comes to insurance, this can sway dramatically as younger drivers will find themselves paying a higher premium just to be on the road but on average, insurance costs an experienced driver about £436 every year. Car tax is another outlay and can equate to £116.35 on an annual basis. Car supplies can cost a driver £29.61 and if you were to go abroad and drive, holiday rental cars can leave you £180 out of pocket. Speeding tickets - let's hope none of you do this! - equal £25.12 for the average driver here in the UK. All in all, this would cost a driver £2,594.38 in total whereas commuters find themselves paying considerably less and for a significant service. Just imagine the saving you could and would make with a megarider ticket! 


Lifestyle

Coffee
According to research carried out by MyVoucherCode, people in the UK visit coffee shops at least three times over a seven day period although this is hardly surprising given that there are over 21,000 outlets around the country! They're far too handy and tempting. This means that Brits visit coffee shops around 156 times a year with an average spend of £8.52. Add this to travel expenses and all of a sudden you could be spending about £14 a time. This means that many of us spend a staggering annual average of £2,600 on our morning coffee. Imagine if you switched to taking your own coffee to work? The majority of this money could then be in your bank account instead. Food for thought.

Branded coffee company, Douwe Egberts, has said that a 250g pack of ground coffee can make up to thirty cups. When looking to see how much a 1kg pack would cost, Amazon has priced the coffee at around £15, meaning that each cup of coffee would cost close to 13p. For an exercise, try taking a flask to work or purchase an on-the-go coffee cup that will see you through your day.

Smoking
If the decline in health and the rise in prices for cigarettes hasn’t already put you off, knowing that you could save a whopping £3,796 (if you smoke 20 a day) just might be the driving mechanism for you to quit. MoneySupermarket has stated that non-smokers pay around £6,309 less for life insurance, which could be something worth investing in.

Vaping is an alternative that many smokers are now trying in order to save money and improve on health. 10ml bottles of liquid cost around £5 on average saving those who turn to vaping around £1,900.

Lunch
Naturally with the pace of life, many of us find it easier to just buy lunch on the way to work. Others find it less stressful to pop out on our lunch breaks. But what if I told you that on average, (according to research carried out by VoucherCloud) forking out for lunch every day could cost you £1,288. Evidently, you could make a huge saving just by preparing your lunch at home whether this be making a quick sandwich or buying a tin of microwavable soup to heat up. When we looked at the total working days in 2017, there was 252. If we went by Poundland’s price of tomato soup, which is 50p, you would find yourself paying £126! Already a massive saving for anyone looking to cut down on costs. 


Unexpected Expenses

We’ve all been victim to an unexpected expense with 54% of 2,000 people asked saying that they suffered from an unexpected expense within the household. On average, these costs totaled £248.70 showing that any saving you do make is beneficial for occurrences like these. 47% of these issues happened in the kitchen, a room which is essential to the day-to-day running of any home and if you don’t have the money to hand when needed then this could cause huge everyday stress. Imagine the savings you would make simply by taking your own lunch and coffee to work, quitting smoking, and travelling smarter. 
Worryingly, it was found that 35% of people had to use a credit card just to cover the costs of unexpected expenses with 18% of them not being able to pay more than £100 on their own. 17% had to borrow from friends and family! Is it any wonder many of us are struggling financially?

Thinking smarter for 2018 is an absolute must and there's no time like the present to start putting things into place. What are your financial goals for this year?



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