There are two key elements to building wealth. The first is to make money and to use that money to make even more money. The second is to try to hold on to as much of it as possible by reducing what you spend.
There are many techniques that can be used to save money; here are some that you can do with ease.
Make Use of Promotional Offers
Businesses use promotional offers to entice their customers into buying from them instead of their competitors or to buy something they may not have otherwise bought. For the frugal and savvy, promotional offers can be exploited to get things that you would have bought anyway, for free. For example, British banks often run promotions where they offer to pay you as much as £200 to switch your current account to them. If you were planning to do this anyway (or you are willing to switch), then you can make £200 for very little work. Other promotions the frugal can take advantage of are: discounts on non-perishable food items (by purchasing in bulk), and free gift cards from stores like Amazon.
Save Money on Driving
Most people interested in building their wealth will understand that you want to accumulate as many assets as possible while minimising your liabilities. While assets like property, stocks, and bonds are all assets that SHOULD go up in value in the long term, a car should be considered a liability, despite it being something you own. This is because a car depreciates in value; this means that you will end up selling it for less than you bought it for. Even driving it off the forecourt can cost you thousands.
Even if you have a car with a low rate of depreciation, it still costs a lot. Typical running expenses include fuel, insurance, tax, parking fees, serving costs, tyres, and cleaning costs. Even if you don’t drive it, you’ll have to pay tax, insurance and for its annual MOT.
Some simple techniques for saving money while driving include:
- Don’t buy a new car, these depreciate faster than any others
- Keep hold of a car for as long as possible
- Research the insurance, tax and running costs of a few cars before you decide which one to buy
- Shop around when buying insurance. Car insurance for the same car and cover level can be hundreds (or even thousands) more between different companies
After a long day at work, do you ever find yourself too tired to cook in the evening, or feel that you can’t be bothered to prepare your lunch for the following day? Is your solution to these problems ordering a takeaway, or picking up a pre-packaged sandwich from a supermarket?
If the answer is yes, then you have an opportunity to save a lot of money and time. The average Brit spends £1,320 per year on takeaways, so there is a big opportunity to save money. If you cook a large quantity of a particular meal in one go, little extra effort will have to go into your preparation time, but you’ll have several days of lunch and dinner that’s ready to eat. Pasta is a great option for bulk cooking, but you’ll find many recipes online.
Not only will this help you to save money by not spending on takeaways and supermarket sandwiches, but you’ll also save money by buying larger quantities of the ingredients.
There are of course many other ways you can help cut down your spending. However, these three simple tricks will have a big effect on your frugality as they are integral parts of life. Since you have to buy food and travel every day, these relatively small changes will compound into big savings over time.