IT’s not summer yet, so there’s still plenty of time for Brits to give their finances a spring clean – and potentially save thousands of pounds.
It’s more important than ever before to get your dosh in order, as a flurry of tax changes and hikes are coming into force from this month.
For example, millions of Brits could be forking out over £100 more for council tax and see their energy, water and broadband bills take a hike.
If you’re concerned about how to make ends meet, there are ways to beat the bill blues – and even add some more cash into your savings.
We’ve rounded up 10 ways you can give your finances a makeover and get a head start this new tax year:
1. Check your benefits and entitlements
Times are tough during the pandemic, and as millions of Brits still face pay cuts, job losses and furlough, many will need extra help getting by.
But families are missing out on £16billion worth of benefits that they’re entitled to, according to the most recent estimates by charity entitledto.co.uk.
People are failing to claim for several different benefits including: Child Benefit, Child Tax Credit, Working Tax Credit, Pension Credit, Housing Benefit, Job Seekers Allowance, Council Tax Support and Income Support.
You could be thousands of pounds out of pocket – for example, a household that could claim Child Tax Credit, Working Tax Credit and Housing Benefit would be missing out on over £9,000 a year altogether.
You can use a free benefits check-up calculator to make sure you’re getting all the cash you can.
Turns2Us and StepChange have calculators online that you can use too.
2. Think about your pension
It can be tempting to forget about your pension and prioritise other savings if you’re nowhere near retirement age.
But Brits have been warned to boost their retirement savings now, following concerns that the state pension “won’t be enough” to get by financially.
This is in spite of an expected pension bump in 2025, when the weekly sum is forecast to rise above £200 a week.
But there are ways to make sure you’ve got enough cash in the bank for the future.
Top tips to boost your pension pot
DON’T know where to start? Here are some tips from financial provider Aviva on how to get going.
- Understand where you start: Before you consider your plans for tomorrow, you'll need to understand where you stand today. Look into your current pension savings and research when you’ll be eligible for the state pension, and how much support you’ll receive.
- Take advantage of your workplace pension: All employers are legally required to provide a workplace pension. If you save, your employer will usually have to contribute too.
- Take advantage of online planning tools: Financial providers Aviva and Royal London have tools that give you an idea of what your retirement income will be based on how much you're saving.
- Find out if your workplace offers advice: Many employers offer sessions with financial advisers to help you plan for your future retirement.
If you are employed, staying in the workplace pension scheme is the best way to help fill your retirement income gap.
There are minimum contributions that you and your employer must pay, and these are being gradually increased over time.
A minimum of 8% must be paid into the pension, with you contributing 5% and the employer paying at least 3%.
Your minimum contribution currently applies to anything you earn over £6,240.
Make sure you’re tracking where your pension pot is too when you change jobs.
Savers lose up to £300 a year from their pensions due to frequent job moves and there is currently more than £5billion in forgotten pension schemes in the UK, according to the Pension Tracing Service.
If you’ve already reached retirement age, then you’ll want to make sure you’re getting paid the right amount..
It comes as more than 200,000 women could be owed a £13,500 payout after being underpaid on the “old” pensions scheme.
You can use a new tool that can calculate if you’re owed money.
One woman got a whopping £82,000 back after watching a reminder from Martin Lewis on his show on ITV for women to check their pensions.
3. Budget for the year ahead
The new tax year starts on April 6, so give yourself a head start this year by figuring out what you’re willing to spend and how much you think you can save over the year.
Moneyfacts finance expert Rachel Springall says the new tax year could be a “good opportunity for someone to budget for the year ahead, either with a simple spreadsheet or using a free mobile app like Money Dashboard”.
Money management apps like these could help you shift big debts like first-time buyer Hanna Cevik did.
She was plunged £24,000 into debt after buying her new home – but cleared it in three years using the Money Dashboard.
But it’s not the only one you could use to help you save.
We’ve rounded up 10 of the best apps from budgeting app Cleo to the bank fee charges tracking app Emma.
4. Shake-up your grocery shop
Savvy shoppers can slash hundreds off their big shop by using cashback websites.
Two of the most well-known cashback websites are TopCashback and Quidco.
You’ll get cashback on purchases you’ll be making anyway – and you could get 1% to 15% back on your original spend.
Keep in mind it isn’t paid to you instantly – it usually takes around 30 days to land in your account once your payment has been confirmed.
How do cashback websites work?
They promise to earn you money on your shopping – but how do cashback websites work?
- Cashback sites agree offers with retailers which they pass on to customers
- This can vary from a set amount of money off whatever you are buying, or a percentage of the cost of your purchase
- The sums range from pennies for groceries to more than £100 for some mobile or broadband contracts
- You have to make your purchases by clicking through from the cashback site
- Because the sites drive traffic to retailers, they earn money from brands they support
- Membership of most sites is free – although some offer premium subscriptions which you pay more for.
You could also save thousands more if you swap posh shops like Waitrose and M&S for discount brands like Aldi and Lidl.
Consumer group Which? found the price of 45 items – based on both branded and non-branded goods – cost just £42.67 at Lidl, compared to £68.69 at Waitrose.
This means you save £26.02 per shop at Lidl.
Multiply this by four if you're a weekly shopper, and you'll save £104.08.
5. Question your taxes and bills
If money is tight, then every little saving counts when it comes to paying taxes – especially as some have gone up recently.
Millions of families will see their council tax bill jump by up to 5% this month after the Treasury gave the green light for the tax hike in last year’s spending review.
It could push bills for Brits up by over £100 a year.
But you could knock some money off your bill by checking your council tax band – if you’re on the wrong one, you could be paying too much.
The first step is to check what council tax band your neighbours are on – you can then see if it matches your band.
Use the GOV.uk website to do this for houses in England, or the Scottish Assessors Association (SAA) for properties in Scotland.
If you find your property is in a higher council tax band compared to your neighbours, you might have a successful challenge.
Be warned though – if you find out you’re on a lower council tax band than you should be, you could end up forking out more.
If you’re a graduate, it might be worth checking out if you’re due a refund on your student loan repayments.
A recent investigation by MoneySavingExpert found some 100,000 ex-students were overpaying.
This was due to a number of reasons, including ex-students being put on the wrong payment plan by their employer, payments being taken early or even AFTER grads had finished repaying their loan.
You can log into your Student Loans Company (SLC) account to see the most up-to-date information for your loan.
6. Slash your credit card interest
If you’ve been spending more than you can afford on your credit card, you might find you're now facing a hefty interest bill.
It might be worth checking if you can switch to a 0% balance transfer card and slash this cost.
For example, we used this Moneysupermarket calculator to work out that if you owe £500 on your credit card, and you're paying off £20 a month at an interest rate of 18.9% APR, you'd accrue interest of £126.
Sainsbury’s has recently launched a top balance transfer card with an interest-free period of up to 29 months – which is the longest balance transfer rate on the market according to data from Moneyfacts.
Be warned though that applying for multiple credit cards will hurt your credit score.
Use an eligibility checker, such as one from MoneySavingExpert, to see what deals you're likely to be accepted for beforehand.
7. Get on top of your debts
The Covid crisis has wreaked havoc with millions of Brits’ finances.
More than eight million people have had to borrow cash because of the Covid crisis, according to the Office for National Statistics.
And StepChange announced the UK was in a debt crisis last year, as millions owe an extra £2,000 as a result of the pandemic.
Citizens Advice debt expert Rachel Wilson told The Sun that Brits should take the following seven steps if they’re in debt.
“For anyone in debt, the first step is to work out how much you owe," she says.
"Make a list of what you owe and add up how much you need to pay each month.
“Next, check you’re getting all the support you’re entitled to. That includes any benefits that could help top up your income.”
Brits should then prioritise their debts and pay the ones that bear the most serious consequences for not paying up first, such as your mortgage or rent.
Step four is calculating a budget of how much you can afford to put towards paying your debt.
Step five is contacting creditors to ask for help with repaying your urgent debts, while step six is contacting creditors about less urgent debts.
The final step is to reach out to bodies like Citizens Advice that can help you with debt advice.
8. Switch your bills
From broadband to council tax, families could be forking out hundreds of pounds extra each year for their household bills.
Price hikes will hit eight kinds of bills this month – and we’ve tallied up that you could be paying over £400 as a result.
If you’re worried about whether you’ll have enough cash to cover this, you can potentially save thousands of pounds by making just a few changes.
Shopping around for a better deal with another provider is one way to save.
How to cut your bills
IF you’re struggling financially, you might be able to cut the cost of your bills to help you get out of the red.
Council tax: You can apply for a council tax reduction on the Gov.uk website but you'll need to meet certain criteria. Your bill could be cut by as much as 100 per cent if you’re on a low income or claim benefits. Carers who look after someone in the household for at least 35 hours a week are also exempt from paying.
Water: Households might be able to save money by getting a water meter but it all depends on how much you're using. To check if it's finacially worthwhile, use the Consumer Council for Water's free ater meter calculator.
Rent: If you have the space available and your landlord or local authority says it's ok to do so, you might want to consider getting a flatmate. Not only will you split the cost of the rent, but also the other bills.
Hire purchase: If you're struggling to make your repayments on your hire purchase, you can usually end the contract by returning the goods. You will have to pay all the instalments due up to the time you end the agreement but this will limit the amount you owe. Contact Citizens Advice for free for more help with this.
Gas and electricty: MoneySavingExpert says families can save £330 on average by switching from Standard Variable Tariffs (SVTs) to a better rate. Use a comparison site such as MoneySuperMarket or Energyhelpline to see what deals are available.
Mortgage: If you get into debt with your mortgage payments, don't wait for your lender to chase you. Work out what you can afford using the Citizens Advice budgeting tool so you can discuss your payment options moving forward with your mortgage provider.
Secured Loan: Your secured loan might be covered by the Consumer Credit Act and if it is, you may be able to apply for a Time Order. This is a special agreement by the courts allowing you more time to make payments. Secured loans not covered by the Consumer Credit Act include gas, electricity or water meters, payments that need to be written off in full, mortgages, credit union loans, loans from an employer and some short term trade agreements.
County Court Judgements: If you receive a County Court claim form talk to a free debt advice service straight away. This includes Citizens Advice (0808 800 9060), StepChange (0800 138 1111) and the National Debtline (0808 808 4000).
TV licence: Some households are eligible for a reduced fee or free TV Licence. Check here to see if you are entitled to a reduced or free rate.
Confused.com estimates that Brits could save an average of £103 a year if they switch energy suppliers,.
Its energy expert Max Green claims making a move is a “really simple process”.
He says: “All that’s needed is the address, direct debit details and some personal information such as name, date of birth and email address.”
Meanwhile, if you’re a Three Mobile, Vodafone or EE customer, you might see your bill jump up to £45 from this month.
But bill payers who are out of contract can switch deals penalty-free, and it could save you up to £360 a year.
9. Get freebies
There's an old saying that goes "you don't get 'owt for nowt", but it's not exactly true.
You can bag freebies and save yourself some cash if you know where to look.
Bargain hunter Kaisa Dul has saved over £1,400 by bagging free stuff including designer handbags and make-up.
She enters Facebook contests and visits freebie websites like LatestFreeStuff.co.uk to bag her hauls.
Savvy saver Holly Smith, who founded the Facebook page Extreme Couponing and Bargains UK, has also bagged loads of baby essentials without spending a penny.
She says to download the Emma's Diary App which offers mums four "starter" packs full of freebies and can be collected from Argos and Asda.
She also said she gets freebies from Boots Parenting Club – which gives members eight Advantage Card Points for every £1 or more spent on baby products.
10. Do a savings challenge
Savings challenges are a great way to put a little aside often which can add up to hundreds by the end of the year.
There's a number of challenges you can choose from, depending on how much you want to save and what you can afford to put aside.
For example, the £5 a week challenge could save you £650 a year and the Monday to Friday challenge could save you £780 – if you stick to the rules.
Under the £5 a week challenge, you put aside a fiver for the first week of the month, and increase this by a fiver every week of the month.
The Monday to Friday challenge requires you to put £1 into your savings and increase this amount by a £1 every day until you hit £5 on Friday.
Usually, many people choose to start a savings challenge at the start of the year – but it's better late than never.
Remember, to stash the money in an account that pays interest – such as an Isa or savings account.
For more guides, we've rounded up eight Martin Lewis money-saving tips that could save you £9,243.
Here is a mammoth 50 ways to save money including best apps.
And we've rounded up 16 tips to slash your supermarket shopping bill by HUNDREDS of pounds a year.
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