The festive season is fast approaching, and aside the holiday cheer, we all know that means one thing in particular – expense. It can be a very costly time of year, with extra events to attend, gifts to buy and parties to throw – and if you haven’t financially prepared throughout the year you can easily be caught short. Many families fall into the trap of using a credit card to pay for the holiday season and start of the New Year with debt, which is not a good situation. It’s far better to plan in a lean couple of months and make some extra savings to take the sting out of celebrations.So if you need to save money fast, here’s how…
Start Living The 80/20 Rule
This is a way of life advocated by a lot of financial gurus, otherwise known as the Pareto Principle, and it’s probably already present in your life without you knowing it. If you look at your latest grocery bill and analyse it, you’ll probably see that around 80% of the total bill comes from 20% of the items you’ve purchased. This same pattern tends to crop up again and again. The trouble most people fall into when they try to save money fast is focusing exclusively on that 20% of extra discretionary spending – whereas the best and most high value results come from focusing on that 80% of everyday spending – bills, food and rent or mortgage. Start by using a comparison site to shop around for car insurance or medical or home cover as they come due, and see if you can switch your mortgage to a cheaper deal or some lenders will allow a payment holiday if you really need the extra cash. And make sure you take advantage of loyalty schemes like Nectar as they can really make your money go further.
Pay Yourself First
We all have good intentions when it comes to our plan for saving money, but if you often find there just isn’t anything left over at the end of the month, then it’s time to put your savings first for a while. Start by scheduling a direct debit into a high interest savings account each month on the same day you get paid. If you adopt this principle of ‘paying yourself first’ you don’t have to rely on your willpower lasting enough for you to make a transfer.
Try A Savings App
There are now some brilliant and very secure savings apps out there which can really help you to control your money better. Many of them offer optional transaction round-ups, which means that every time you spend an amount on your card, it automatically rounds it up to the nearest pound, and deposits the difference in your savings account. When combined with regular savings, this can really turbo boost the amount you can save in a shorter period of time and help you to reach your target amount. Plus, you don’t even notice it’s happening so it doesn’t feel like an extra effort.
Making savings before the holidays is possible – re-evaluate your main expenses and really try to cut them down for a few weeks and you’ll be surprised by what is possible!
This is a collaborative post.