Some 80 per cent of employers believe their employees are not saving enough for retirement but there are ways to cut your costs and boost savings.
The majority of employers believe their staff are not saving enough for retirement. This is usually due to affordability or lack of understanding, but what many individuals don’t realise is the huge difference small changes to their spending habits could make to their savings levels overall.
Here are top 10 tips for individuals wanting to cut their costs and boost their savings:
1. Do you know where your money is going?
Individuals should check their bank statements and make a list of what they are spending each month. It is helpful to divide these into utility bills (gas, electricity and water), mortgage or rent costs, council tax, supermarket shopping, monthly contracts for TV, broadband and mobiles, insurance, regular subscriptions, and other spending. This will highlight where your money is going and where savings could be made. There are mobile phone apps which can track your bank statements or spending and do this for you to make it easier.
2. Compare utility providers
Individuals should consider visiting comparison sites to find out which providers may be the most cost effective for them. For example, Compare the Market found that by shopping around 50 per cent of people could achieve a saving of £219 on their dual fuel energy cost.
3. Look for discount vouchers
There are great discounts available for online supermarket shopping, holidays, restaurants, broadband providers and computers etc. Many supermarkets have offers such as £20 off a first online order.
4. Only buy what you really need
Write a shopping list before you go out, whether it be for food, clothes, or whatever you need, and stick to it. Impulse purchases can add a fortune to the amount you spend each month, so make sure they are things you really need.
5. Consider cash back cards and sites
There are many cash back cards and websites now available which offer money back every time you spend. For some people these might be a good idea, depending on how much they spend and where.
6. Is the latest mobile phone really needed?
Individuals could consider a SIM-only deal rather than upgrading to the latest phone if their phone contract is coming to an end. With a contract, individuals are effectively borrowing money for the phone, and repaying this loan through a monthly bill. Also, tariffs should be checked as there are some very competitive deals available. Be sure to check what is offer from other providers rather than staying loyal to your current network.
7. Regular contracts should be reviewed
Are you making the most of the subscriptions you have? Could you cancel music and other services that you’re not using? It may be worth calculating how much you spend on these types of contracts and see how much of a difference cancelling these may have on your finances. It's estimated that individuals could save a hefty £156 a year simply by cancelling a couple of subscription services.
8. Watch out for auto-renewals
Many insurance policies for cars, homes or holidays automatically renew each year but individuals may not be getting the best deal if they allow this to happen. Motorists who allow their car insurance policy to be automatically renewed report an average increase of £50 per policy. To get the best deal and to avoid any potential price hikes with auto-renewals, make sure you shop around and either switch or haggle where appropriate.
9. Staff discounts
Are you making the most of any staff discount schemes? By signing up to a workplace discount scheme, you could get discount codes to high street stores or buy reloadable store gift cards, which would allow you to buy the credit at a discounted price.
10. Check what employee benefits are available
It isn’t just staff discounts, there are other benefits available to help you save such as Share Schemes, Workplace Isas and car allowances.
Nobody should pay more than they need to on what are often generic services such as utilities. Getting into the habit of checking what you spend money on and making sure you spend wisely is a great way to help free up cash for those little extras, or indeed to invest for the future. Individuals should speak to their workplace and see how they can help too as there are massive savings to made if you look in the right places.
Jonathan Watts-Lay is director, WEALTH at work, a specialist provider of financial education and guidance in the workplace supported by regulated advice for individuals