Rising living costs mean that more of us are looking for ways to save money this winter.
Higher food, fuel and transport costs has seen inflation – the cost of living – rise to 5.2 per cent according to the figures released last week by the Office of National Statistics.
It’s no wonder that 72 per cent of UK adults are worried about their personal finances, according to a survey by financial advice firm Unbiased.
So what better time to take control of your finances. Here are our top 10 ways to save this winter.
Give yourself a quick financial review
Check that direct debits and other payments set up on your account are up to date.
For example, many people are paying insurance for phones they no longer have, or handing over say £15 every month to DVD rental services – yet have never borrowed more than one movie.
With magazine subscriptions, if you’ve been signed up for more than a year, cancel and re-subscribe. You may be able to get another free gift and a reduced rate subscription.
Move payments as close to payday as possible and it will be easier to work out how much money you have left for the rest of the month.
Be disloyal
Loyalty doesn’t pay as often the best deals are reserved for new customers, so save money by shopping around for the best deals on new cards and accounts.
Nerys Lewis, money expert at Confused.com, says: “Many of the best deals are available exclusively via the internet.
“Currently 106 of the 228 credit cards on the market are internet application only so it pays to shop around online for the best deals.
“For example, Natwest’s Platinum credit card has a 20-month 0 per cent deal on balance transfers if you apply online, but only 18 months 0 per cent on balance transfers if you apply in a branch.”
Balance transfers
Moving existing credit card balances to a 0 per cent balance transfer card will cut your interest payments.
For example, if you have a balance of £2,000 on a credit card with interest charges at 18 per cent a year, you could save £508.23 in interest charges over 22 months if you move to a 0 per cent balance transfer card*.
Bear in mind that some of these cards are aimed at prime customers, that is, those with good credit records.
Confused.com offers a free Card Matcher tool that shows you how likely you are to be accepted before you apply.
Set up a monthly direct debit to cover your minimum payment as missing just one instalment can result in your credit card provider ending your 0 per cent deal.
Savings bonus
Savings top the list of Brits’ financial woes, according to the survey by Unbiased, with 39 per cent of those polled admitting this is their top concern.
If you do have money put away, remember that savings accounts often drop to low rates after 12 months, some as low as 0.01 per cent.
So make a note of when any introductory period ends so you can move your money to an account paying more interest.
Derbyshire Building Society currently has the market-leading instant-access savings account, paying 3.16 per cent on its NetSaver Issue 2, while Nationwide is offering a rate of 3.12 per cent on its MySave Online Plus.
Tax-free savings
Use your ISA allowance. You can save up to £5,340 tax-free in a cash ISA each year.
If you have any money in your current account at the end of the month transfer it to an instant-access cash ISA.
The Treasury has confirmed the ISA cash limit for the 2012-2013 tax year will rise to £5,640.
Use it or lose it
Packaged current accounts offer benefits such as travel insurance, breakdown cover, phone insurance, for a monthly fee of anything between £5 and £25.
But if you’re not using these extras or could get them cheaper elsewhere – and you usually can – then ditch the account.
Switch current accounts
You can make money by switching your current account. The Co-operative Bank is offering new customers £200 to switch their main account.
The offer is even open to Co-op current account holders who have their main bank account with another company.
To qualify, customers must switch a minimum of two direct debits or standing orders from another provider and pay in a minimum of £800 per month into their account for the first three months.
The Co-operative is no longer taking online applications for this offer but you can still apply in branch.
Santander’s Preferred account offers £100 cash if you switch your main account, along with 5 per cent interest on balances up to £2,500 and a free arranged overdraft for a year.
Halifax's Reward account pays £5 each month on credit or debit balances, as long as you pay in £1,000 each month.
Earn as you spend
A cashback credit card means you can earn money every time you spend – as much as 5 per cent in some cases.
Capital One’s World Mastercard offers 5 per cent cash back up to £100 on your purchases for the first three months.
Santander’s 123 Cashback credit card offers 3 per cent cashback when you spend money on fuel and 2 per cent on other purchases.
Spending abroad
If you’re lucky enough to be jetting off for some winter sun, planning which cards to use abroad can save you pounds.
Halifax’s debit card charges 2.75 per cent plus £1.50 per purchase for every overseas transaction. The Post Office credit card, on the other hand, has no charges on purchases abroad.
Money-saving apps
There are many clever smartphone apps that can help you budget.
The iXpenseit app allows you to set up a budget and record your daily outgoings by category, making it a good tool for tracking your spending. It costs £2.99 on iPhone.
*After paying the balance transfer fee of 3.5 per cent and assuming you pay off 3 per cent of your balance on time each month.
Note: All details correct as at Thursday, 13 October, 2011.
It's the little things that add up and sting us. With our cost calculator tool you can get an idea of how much you might be spending on bits and bobs.
