During times of high inflation or even recession in 2023 in the United Kingdom, it can be challenging to save money. However, there are always little things you can do to save money during tough times.
Congratulations, by researching this topic you have taken a very important step in creating awareness of ways to improve your financial situation by researching this topic.
Get an overview and prepare a budget
In this first step you will track your income and expenses to identify areas where you can cut back on spending. Usually this requires the following steps:
- Determine your expected monthly income such as your salary or a scholarship.
- List all of your fixed expenses such as monthly recurring costs for rent, groceries, mobile phone or WiFi contracts.
- List all your variable cost such as expected car repairs or the new smartphone that you just bought. It is sometimes difficult to forecast, but try to find a monthly average.
- Find categories for your cost and sum up all fixed and variable cost per month for each category.
- Evaluate on which cost categories you can start saving.
You do not have to do these steps manually, there are better ways available to get this job done quickly.
Cut back on unnecessary expenses
Look for ways to save money on everyday expenses, such as reducing your grocery bill by buying generic brands or cutting back on dining out and entertainment. Housing is often one of the biggest expenses for people, so it can be helpful to look for ways to save on this cost. Consider downsizing to a smaller home or apartment, or finding a roommate to split the cost of rent or a mortgage. Be mindful of debt. During recession, it’s especially important to be careful about taking on new debt. Avoid taking on high-interest loans or credit card debt, and try to pay off existing debt as quickly as possible.
In particular, look for recurring cost that you can save on. Do you need to grab a cup of coffee each day on your way to work or could you save a couple of pounds each day having breakfast at home? Make sure you do not pay too much for your subscriptions and other contracts: A 17 pound cheaper mobile phone contract would save you 204 pounds per year.
Look for discounts but do not fall into the trap of buying things or subscribe to services you do not actually need. Build saving habits and automate your savings with online tools.
Increase your income
Increase your existing income streams by asking for a raise or look for a higher-paying job. If you feel that you are underpaid for your current job, consider talking to your boss about a salary increase. Be sure to have a list of your accomplishments and the value that you bring to the company to support your request. In case you are unable to negotiate a raise in your current job, consider looking for a higher-paying job elsewhere. Be sure to update your resume and cover letter and practice your interview skills to increase your chances of success.
During a recession, it may be more difficult to increase your salary, so you may need to find a way to earn extra income. Consider finding a part-time job or starting a side hustle to bring in additional income. Think about your skills and interests: What do you enjoy doing? What are you good at? Consider starting a side hustle in an area that aligns with your skills and interests. Use online platforms to find short-term or project-based work. There are many online platforms that connect people with freelancers or contractors. Some popular options in the UK include Upwork, Freelancer and or local options. Sell products online if you have a talent for creating handmade or unique products. You could consider selling them online through platforms like Etsy or eBay. Also consider offering services in your local area: For example, you could offer tutoring, pet sitting, or home maintenance services. If you have a passion for writing or creating videos, you could start a blog or YouTube channel and monetize it through advertising, sponsorships, or affiliate marketing.
The more income streams you build, the higher your financial stability will be in the long term. Remember to do your research before and make sure that any side hustle you pursue is legal and complies with all relevant regulations.
Build an emergency fund
It’s important to have some money set aside in case of an emergency, such as losing your job or unexpected expenses. Aim to save at least three to six months’ worth of living expenses in your emergency fund. Having some money aside will allow you to think more freely and reduce fears to take steps into a new direction.
Do not wait and get started now
By following these tips, you can help to save money and protect your financial well-being during times of high inflation in 2023. Prepare a budget and cut back unnecessary expenses with just a few simple clicks by downloading the Brevius app today for free from the app stores.