Category: Money

11 strategies on how to shop more on a budget

It’s easy to learn how to shop more on a budget. If you can save money by buying goods on a budget, then by all means do so. In most countries, food is very expensive at the moment, and you should learn how to save money and do your grocery shopping on a tight budget.

This is particularly important when you have a large family to feed and need to stretch your resources. Shopping on a tight budget is easier if you compare prices and look for sales.

Recently, the inflation rate in the UK has been going up which has been affecting the quality of life. is at a 40-year high.

UK’s current inflation rate means people need to find ways to improve their cost of living.

It is also important to understand how inflation is affecting your cost of living.

Shopping on a budget means that you determine how much you are willing to spend in advance and then stick to it.

If you go over budget in one area, the extra cash must come from another part of your budget. So it’s important to carefully consider any changes before implementing them.

Before spending any money, make good decisions and think long and hard to find out whether you are within your means.

How to shop more on a budget

  1. Practice Online Shopping:

Online shopping has become easy and convenient for customers thanks to e-commerce.

For clothing and accessories, you need only know your size and order from the comfort of your home.

For Food items, you just need to have a list of what you are looking for.

When you shop online, you can compare prices and find the best value for your money. This is even with the added benefit of not having to pay sales tax. You can save more money.

A lot of companies offer free shipping, depending on where you live and the terms and conditions. You should do some research and inquire about this.

  1. Plan your shopping:

Before you decide how much you have to spend on shopping, work out your monthly budget. Then plan for living expenses such as utilities and housing.

If you need to pay for the essentials in an order of importance, write them down and use your income to do so.

Keep to the budget you’ve set yourself and avoid impulse purchases.

  1. Make use of Coupons:

You should use coupons when you are shopping; there are grocery stores that offer discounts to those with a membership card.

Before you sign up for a membership card, research all the grocery stores in your area. You can then choose one or more that appeal to you.

This is if the membership card is affordable and won’t affect your budget. This way, you can find the best prices and fit into your tight budget. If you are shopping for clothes, always ask if there are sales.

  1. Think of Food:

Be sure to write down your shopping list before you go to the store and then stick to it.

Shop in discount stores and other places where you can get great deals on high-quality foods. An example is your local farmer’s market.

Avoid buying candy and junk food as they tend to be expensive and have little nutritional value. So, whenever possible, buy food in bulk and prepare large meals so that you can freeze a portion for later use.

When you have a shopping plan, you can eat well for less.

  1. Shop during Sales:

Most stores run regular sales, and you can usually find bargain clothes in a sales section.

You can ask a salesperson about items on sale and look them over. Also, you should think about shopping out of season.

During some sales, you can buy basic products for as little as 75% off.

Taking advantage of sales is a guaranteed way to shop more on a budget.

  1. Practice Circulars shopping:

Before you plan your meals, open circulars from your local grocery stores. Most offer email subscriptions so you can get newsletters.

You can then compare what is on sale and which retailer has a better price on common items.

If you know that the store often sells oranges at a discounted price of two for four during the summer months, you don’t need to pay 4.99 GBP for a carton of strawberries.

  1. Buy from Thrift Store:

If you are shopping on a tight budget and live in an expensive location like London, thrift stores might be the best option for you. This way you can find vintage goods for less than the price of shopping at more expensive stores and brands.

You can find a range of products, sometimes, including the newest fashions.

  1. Eat Twice and Cook Once:

If you find a really good deal on the lasagna ingredients, buy enough for two and keep the other in the freezer.

No need to stretch your budget when cooking a quick dinner. Simply pull out the leftover recipe and toss it in the oven the next time you have to plan a meal.

This option is easier and cheaper than if you had purchased all the ingredients for the second lasagna at their regular prices.

This can help you shop more on a budget.

  1. Buy items in bulk:

Non-perishable items such as tissue, toothpaste, rice, sugar, and tin items should be bought in bulk. This may seem expensive at first but will ultimately save you money in the long run.

Buy things that you are certain to use, or it is a waste of money.

Also, sometimes, buying items in bulk can help save money unlike buying items individually. Depending on where you are shopping, people are always discounted for buying certain items in bulk.

For example, instead of buying that soda in pieces, why not save money on it by buying a pack?

Buying items in bulk is an effective way to shop more on a budget.

  1. Plan for leftovers:

Do not throw away your leftovers.

Throw away leftovers, and you’re throwing away the money you spent on the ingredients.

When you are preparing your meal plan, include leftovers in it.

For example, you can prepare them for lunch the next day, or use them as a sauce for another meal.

You can also adjust the recipe for the amount of food you and your family will consume. If you like a certain rice sauce, you can cook more than you need to. Then store the leftover in the refrigerator.

  1. Shop at the market:

Shopping at the local market often proves to be more affordable than buying items in the supermarket.

This is especially true in countries where items are imported and sold at the supermarket. You will pay a premium for items that are not made locally.

Buy your vegetables and ground provisions at the local market. If you know a local farmer, you can buy them from him.

Planting your vegetables is another great option; why not get a backyard garden and eat what you grow? It can be a fun experiment.

Conclusion

Some might find these tips to be excessively frugal. But when you cut costs in lots of small ways, you can make significant savings without making any huge sacrifices.

It does not take a great deal of time or energy to get into the habit of thoughtfully considering your purchases. You may not always make the choice that will save you the most money and choose convenience, but at least you have made a conscious, well-informed decision.

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WAYS TO MAKE MONEY OFF YOUR KNOWLEDGE

If you are an expert in your field, you should probably seek ways to make money off your knowledge and earn something extra. If you are one of these people seeking ways to monetize their knowledge, you have come to the right place.

In this article, we are going to explain how you can make cool money sharing your knowledge and teaching other people that which you know how to do well.

However, before you go ahead and try to monetize your knowledge, make sure you really know this field in depth. You don’t have to be perfect at it, but you have to have a great deal of knowledge on the subject matter to be able to share this knowledge.

Also, make sure you have value to provide to people seeking to learn more in this field. You have to show that you have and you can provide value to them. This way, you will be trusted more when you finally decide to monetize your knowledge.

Test the waters by putting out contents into the world and building an audience. You can start a blog, vlog or podcast. You can create social media pages to showcase your knowledge. Once you have attracted a good number of audiences interested in what you know and who want to learn from you, you can now start to monetize it.

There are endless opportunities to make money based on what you know. Here are some ways you can earn some money with your knowledge.

  • START A BLOG

Writing about what you know on a blog is a great way to earn some money. Create a blog based on your niche, create amazing content that provides a lot of value in this niche, ask questions people might have on the particular topic and break down seemingly complex areas.

Focus on creating high-value content that will help generate traffic to your blog. Note that your focus should be on the quality of your article, and on serving your readers the valuable content they need.

You can advertise on your blog to make some money once your blog starts to generate good traffic. You can advertise via google ads or team up with companies and help them advertise their product for a fee.

However, blogging may not make you a lot of money but can serve as a ladder to something more. For example, building an audience who knows you deliver great value might come in handy when you decide to publish a book. By then, you will have a willing market ready to buy.

  • FREELANCE WRITING

You can reach out to magazines and websites in your niche that is willing to pay for your content. First, you must establish yourself as an expert in the field who can provide the type of informative and educative article they are looking for.

Make sure you have samples of your work at hand to establish yourself as an expert. Your blog or social media pages where you talk about your niche might also come in very handy.

Some of these magazines or websites pay a flat rate while some pay by the page view.

  • PUBLISH A BOOK

Another way you can make money off your knowledge is by publishing a book. Consider sharing what you know in a book and selling it to people who will benefit from the knowledge.

For this to work well, you must be seen as an expert in the field who provides value. This way, people will trust you enough to buy your book. You can establish authority by implementing social media or blogs to share free knowledge. Try to build a solid audience base who will become paying customers when you publish your book.

You can decide to publish the traditional way or self-publish. If your book is the type that will appeal to a lot of people, it is advisable to go the traditional way. Publishing this way has a lot of advantages and is more lucrative.

You earn an advance and royalties which is a set amount of money you will earn regardless of how many copies are sold. The publisher also takes care of all the expenses incurred in publishing the book. In addition to this, you have a professional team to help you to publish the book.

However, it might be a bit hard to get a publisher, especially if your niche won’t attract a wide audience. You might have to resort to self-publishing.

You can also research how to start selling books on platforms like Amazon.

  • CREATE A COURSE

Based on your niche, you can create courses to host on your personal website, this way, all your earnings go to you. However, you need to have a functioning site that drives lots of traffic and people willing to pay for the course.

You can also put up your courses on a popular site like Udemy, where you earn some money when someone buys and pay for the course. However, you might need to pay a token to put up your course on the site.  You can also create a course in collaboration with another company where you can earn an advance and royalties.

  • BECOME A COACH

Offer one on one coaching to people who need help or tutoring in your niche. You can also offer a group tutorial to people who are looking for help on the subject. It may be virtual, hosted on social media spaces where people pay a token to participate.

It may be real-life coaching as well. There are different media to explore when it comes to coaching, carefully choose one that’s perfect for your niche. These days, people organize masterclasses to share their knowledge in their field with people who need it.

Your services can also be offered to organizations or businesses that could use your expertise.

  • PUBLIC SPEAKER

This can be a lucrative source of income if you go about it the right way. You can be a motivational speaker who gives speeches for handsome pay. You can also organize training and workshops for people who are eager to learn about your field.

  • ONLINE SURVEYS AND TASKS

There are online surveys and tasks designed for people who are an expert in a particular field. However, this may not pay much but it’s a great way to cash in on your knowledge.

  • WEBINARS

Hosting a paid webinar to share your knowledge is a great way to make some money. You can utilize Skype and Google Hangouts to work with clients, one on one. You can also utilize ClickMeeting to host a live video to teach and share valuable insights to your audience for a token.

Targeting a large audience to teach a paid webinar is very lucrative. If you offer great value, you may be able to get hundreds of people to pay to learn from you via a webinar. Several things can be taught here, ranging from practical classes e.g cooking classes to theoretical classes.

  • ONLINE CONSULTING

You can earn money as a consultant online. For example, if you sign up on a site like Maven, you get paid to answer questions on your area of expertise.

All you have to do is sign up, select your consulting rate per minute or hour and answer some questions about your niche. The site will find you a gig and match you.

  • VIDEO TUTORIALS

If you love making tutorial videos based on your niche, you can find a way to make some money from it. You can post these videos on a platform like YouTube and learn how to grow them. Once you meet their requirements, you will be able to earn some money from it.

Conclusion:

Most times, we underrate how much we know about certain subjects by thinking we don’t know enough. You’d be surprised how many people out there don’t know even half of what you know and will pay to learn from you. Looking for ways to make money off your knowledge is one of the most convenient ways to make extra money.

 

 

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Is Cheltenham actually in the Cotswold?

Cheltenham’s proximity to the Cotswold makes a lot of people think that Cheltenham is in the Cotswold. Geographically, Cheltenham is not in the Cotswold.

Cheltenham is a very important town in Gloucestershire and plays a very important role in fostering the economy of the Cotswold area.

Cheltenham is often regarded as the Centre of the Cotswold because the town is just at the edge and boundary of the Cotswold AONB and Cotswold District Council.

Cotswold area is one of the most beautiful regions of Britain and the area has a very rich history.

The Cotswolds are a region of undulating hills in central-southwest England that extend from the upper Thames’ meadows to an escarpment over the Severn Valley and Evesham Vale.

When the boundary of the Cotswold is been considered. There are two possible ways to see the boundary of the Cotswold.

Cotswold AONB

An area of outstanding natural beauty ( AONB ) is land protected by the Countryside and Rights of Way Act 2000 ( CROW Act ). AONB is a landscape that is protected at the federal level.

Each AONB was established as an AONB in order to protect these assets for future generations.

Each AONB has its own unique, sometimes distinctive, traits in terms of its culture, history, and wildlife. Cheltenham town boundary does not fall within the boundary of Cotswold AONB.

Cotswold District Council

This is a local authority that is one of the Local Authorities in Gloucestershire county. The Cotswold district council covers the majority of the Cotswold AONB. Cheltenham is outside the boundary of the Cotswold district council. Cheltenham has its own local authority called Cheltenham Borough Council

While Cheltenham is technically not within the boundary of the Cotswold, the town is very important to the Cotswold.

Cheltenham town is in proximity to most of the Cotswold towns and villages including the Cotswolds tourist attractions and landmarks.

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Best proven ways to improve your cost of living

Thanks to several factors, the cost of living has increased a lot globally and in the UK in 2022. A lot of people have started researching the best-proven ways to improve their cost of living.

The cost of living represents money that is required to pay for basic living costs in a location and time, such as housing, food, taxes, and health care.

A recent health and wellbeing survey showed that 1 in 5 people struggle to adapt to the rising cost of living.

This is why we have decided to do our own research and suggest some tips to help you improve your cost of living. These strategies will help you cut costs at home and even save –money.

Even if you are not struggling with the demands of the increased cost of living, you can still read this article.

  • Track or Pay attention to how you spend

One of the first steps to having a better cost of living is to track your expenses. When you do this, you know where you are leaking money and where to plug it.

Without tracking your income and expenses, you can’t effectively create a budget.

Keeping track of your expenses will help you understand your financial situation i.e. how you spend money, save money and your income.

To track your income, you must be as detailed as possible when tracking your incoming and outgoing.

To do this, you can make use of several budgeting tools or online budget planners.

Once you understand your spending habits, you can then know which of your spending is essential and non-essential.

What you decide to remove might be a streaming service that you don’t really use or a gym membership. It can be anything you deem non-essential and can be cheaply replaced or ignored entirely.

  • Bargain where necessary

Bargaining helps you get value for money most time. Most people, especially the middle and lower-income earners look for the best deal possible on everyday products and services.

Switching to a less expensive service or product is one way to bargain. Looking for promo deals is another.

Moneysavingexpert has a guide on how to negotiate for the best deals.

Lower-income families can also look for income-based savings programs.

  • Create a budget system:

Once you have a better knowledge of your income and expenses, you can then create a budget system. It is the second step to improving your finances.

To create an effective budget, write your short, medium and long-term goals. This gives you room to make your money work better for you.

An example of your short-term goal might be paying off your debt. A medium-term goal may be saving for a course. A long-term goal may be going on holiday, saving up for your child’s education or applying for a mortgage.

You can be as flexible as you want with your budget.

Having budget systems ensure you have a strict plan to follow. It is very easy to deviate from a plan but your budget should help put you in check.

  • Shop for groceries

Eating out can greatly have an impact on your cost of living as it is more expensive than eating in. this is why shopping for groceries is one step to improving your cost of living.

A simple hack to shop well for less is to create a meal plan and shopping list. With this list, your shopping for any given period is streamlined and will reduce spending.

You can also choose to alternate between cheaper and generic brands instead of your favourites.

You can also look for supermarkets offering deals on products that you need whether through coupons or in-store discounts.

  • Fuel Pricing

Energy prices are at a record high in 2022. This increment has greatly affected the prices of petrol, diesel and gas.

This is why it is now important to be strategic with your refills.

Do you still need to take your personal car around or are you better off taking public transport? You need to ask yourself these questions and do your appropriate calculation.

You can also use online platforms that compare diesel and petrol prices in your area to find the best deal around.

You really don’t need to go everywhere with your car or switch on your air conditioner all the time.

You also don’t have to cook individual meals at home. The advantage of having a meal plan is that you can cook in bulk and refrigerate appropriately.

  • Appliances using Energy

Energy prices are also ridiculously high at the moment. This is why it is important to invest in power-saving appliances when you can.

For the appliances already in your house, you can limit how much you use them. Dryers and refrigerators are high energy-consuming. You can find energy-saving alternatives and put yours up for sale.

You have to use a tumble dryer when you can your clothes outside.

Looking for appliances with a high energy efficiency rating will save you a lot of money.

  • Save Fuel For Cars

As mentioned earlier, fuel prices have skyrocketed. For this reason, you must follow some fuel-saving practices.

If you are not a fan of public transport, you do not need to abandon your car entirely.

Firstly, you must define where you have to go with the car. Secondly, you should avoid excessive speeding, especially accelerating aggressively from a standstill. These guzzles fuel a lot.

Also, you can put your car in the “eco” setting if it has. With the settings, your car’s speed is automatically reduced.

You should also, take your car for a thorough health check to ensure essential fuel consumption parts like the fuel pump and nozzle works perfectly.

  • Practice Financial Diet

Procrastination is one of the biggest enemies you must fight to improve your standard of living. You must be intentional about this.

This is why you must set a financial diet goal for yourself. Just like you set a goal for a nutritional diet.

You can give yourself a target of reducing your expenses by 300 pounds in the next quarter.

A financial diet gives you room to manoeuvre your expenses and plan your fat trimming accordingly. It is quite easy to overwhelm yourself while trying to cut costs.

It helps you make good, clear and intentional financial decisions over time.

  • Rent a cheaper apartment

Rent or mortgage has a way of adding up. In fact, for most individuals or families, it is their largest monthly expense.

Ideally, your rent or mortgage shouldn’t take up more than 25%-30% of your income. You should consider finding a new space if this is not ye case.

We know moving to a new home isn’t always the easiest thing to do. But if it means it’ll greatly improve your household’s cost of living, then you should consider it.

Also, this tip is great for prospective new home earners and first-time home buyers.

A couple of hundred pounds that you save monthly on these fees will translate to thousands every year. Think about it.

You can find out more on how you can save for a house on a low income.

  • Avoid being in debt:

Debt has a way of piling up. You may think debt is small or you’d look to borrow from elsewhere to cover the existing debt. But debt is best paid quickly and on time.

Paying off your debts early gives you the chance to focus your finances on other things. It offers a great financial cushion.

The truth is if you can do without getting into debt, you should let it stay that way.

  • Try boosting your income:

One of the easiest ways to improve your cost of living is to earn more than you spend.

How then do you increase your income?

You can try working for and asking for a raise at work. However, you should have in mind that this can go either way.

Another strategy is to find and master a side hustle. Side hustles are the best way to improve your income as it has a lot of growth potential. Several people’s side hustle has become their main source of income today.

There are several side hustle business ideas out there you can consider.

Conclusion

One of the best things you can do to reach your financial goals as quickly as possible is to lower your cost of living.

Have you ever taken the time to add up how much you spend on necessities such as food, utilities, and housing costs each month? It sometimes adds up to a lot.

But, while these areas of personal finance can be expensive, reducing your spending is often the most difficult. With these tips, you can improve your cost of living in no time.

Categories:

Does Vanguard have individual stocks in UK?

Many investors who want to consider investing using Vanguard in the UK often ask whether vanguard offers individual stocks.

As of the time of writing this post, Vanguard does not offer individual stocks to their UK investors.

Vanguard is one of the most popular and favorite investment platforms in the UK. Vanguard is famous for its index fund and ETF.  One of Vanguard’s most popular products is its Lifestrategy.

Stocks & Shares ISA should not be mistaken for the actual stock and shares. One of the account types Vanguard offer for people interesting in investing is Stocks & Shares ISA. However, you can not invest in individual stock and shares. Instead, you can invest in index funds and Exchange-Traded Funds (ETF).

Both individual stocks and shares and Index fund and ETF do have their advantages and disadvantages. if you are not specifically interested in a particular company, I think should consider investing in the Vanguard Index Fund or ETF.

What is the difference between individual stock and index fund?

When you buy a share your investment is in a particular company. This gives you ownership of a single company. An index fund is a portfolio of assets that often consists of bonds, other assets, and shares in numerous firms. This portfolio is intended to follow entire market segments, growing and declining along with those segments.

What are the best Vanguard Funds in the UK

LifeStrategy fund

Vanguard created the LifeStrategy range to help people who do not know how to build and manage their own portfolios. Vanguard LifeStrategy combines multiple individual index funds into one fund portfolio, giving you access to thousands of shares and bonds in a single investment.

Vanguard LifeStratgy is a ready-made portfolio and is one of Vanguard’s most popular products.

Depending on your risk tolerance and stage of life, Vanguard LifeStrategy comes in 4 types which are

  • LifeStrategy® 20% Equity Fund
  • LifeStrategy® 40% Equity Fund
  • LifeStrategy® 60% Equity Fund
  • LifeStrategy® 80% Equity Fund
  • LifeStrategy® 100% Equity Fund

FTSE U.K. All Share Index Unit Trust

This fund is one of Vanguard Equity Funds. The word equity simply means stock and shares. The fund does not have any other assets like bonds.

This fund is unique in that it holds portion shares of all the companies listed on the London Stock Exchange.

It simply tracks the FTSE and follows the performance of the overall UK stock market.

S&P 500 UCITS ETF

This fund primarily tracks the performance of the United States S&P 500 index. It holds a portion of all the companies listed on the S&P 500 index. For UK residents interested in investing in the US stock market, this fund provides you the opportunity to do so.

U.S. Equity Index Fund

Aspiring investors in the UK often enquire about the UK equivalent of Vanguard Total Stock Market Index Fund.

This fund invests in the over 3,000 securities in the Dow Jones US Total Stock Market Index. The objective is to track the total return of the broad US equity market which includes large, mid, and small-capitalization stocks.

A lot of the big companies you might be interested to invest in will be inside this fund.

 

Categories:
10- Jul2022
Posted By: fiezie92
140 Views

How Inflation is Affecting the Cost Of living In the UK

2022 has been a year of highs, but the high in this regard is inflation. The prices of goods and foodstuff have been skyrocketing at an alarming rate. This has directly had an impact on the cost of living of UK citizens and beyond. Inflation is determined by how much goods and services have increased over a given period.

To better explain how inflation works. When you say there has been an inflation rate of 7%, it means that the prices of goods and services is 7% more expensive than in the past year.

This means the cost of living is directly impacted by an increase in the inflation rate.

The Bank of England on May 5 forecasted the highest inflation in the country since 1982 will happen by Q4 2022. They forecasted that the inflation rate will peak by slightly over 10%. They projected that inflation will be at about 9% in Q1 2023, before reducing to 3.6% by the end of 2023 and below 2% in 2024.

1.  Relationship between the cost of living and inflation

Cost of living is the amount needed to maintain a standard of living. Though inflation directly impacts your cost of living, it is not the only variable affecting it. Another variable that affects the cost of living is how expensive a particular area is.

Factors like rent cost, house cost, healthcare, taxes and transport also play a hand in changes in the cost of living. For example, living in a city like London is more expensive than in Hereford, West Midlands and Derry, Northern Ireland.

Some unexpected chain of events can also affect the cost of living in a particular area. During the Covid-19 pandemic, for example, more people had decreased the cost of living because they didn’t have to commute to work.

In an instance where global warming becomes extreme, people in cold countries won’t have to worry about heating anymore. This will reduce the amount they spend.

People in hotter countries might have to invest in air-conditioning. This will increase the cost of living in this region.

2.  Drivers of Inflation

In 2022, there have been three main drivers of consumer price inflation. They are

  • Transport
  • Food and non-alcoholic beverages
  • Housing, electricity, water and similar bills

These three drivers account for more than 50% of the Consumer Price Index.

In May 2022, Consumer Prices were 9.1% higher than in the same period in 2021.

Since April 2022, the Ofgem price cap rise has been directly responsible for the increase in “housing, water, electricity, gas and other fuels”.

Between April and May 2022 alone, the price of this driver increased by over 46%, with a further increment experienced in May.

Motor fuels have played a big part in the high cost of transport in recent months. The annual growth rates for petrol and diesel reached 32.8% in May 2022. This was the highest rate ever recorded since the inception of consumer price inflation in January 1989.

Energy prices, including household tariffs and petrol costs, have also played a role. Between May 2021 and the same period in 2022, there has been a domestic gas price growth of 95%. Domestic electricity prices have also gone up by 54% during this period.

Another factor that affects the cost of living through inflation is political conflicts. An example is how much Russia’s invasion of Ukraine has affected the world’s economy.

The warring countries, Russia and Ukraine happen to be one of the largest producers and exporters of agricultural goods like wheat and metals.

These conflicts and sanctions put on a country like Russia mean these products cost more on international markets.

This has led to an increase in food and material prices in countries like the UK.

3.  Inflation vs real wages

When talking about inflation, it is important to take income into account. What then is the relationship between income and inflation?

If your income is higher than the inflation rate, you will have less to worry about in terms of the cost of living. But if income isn’t increasing at the same pace as inflation then it becomes a problem.

For example, imagine we have an inflation rate of 6%, but the average income also increased by 9%, then the real income would have increased by +3%. This means that inflation has increased but the cost of living won’t affect the family much.

4.  Why the cost of living may rise more than inflation

Energy, transport and food have been the main drivers of consumer price inflation. The problem with this is that these drivers are essential expenses for most households and can’t be done without.

Yes, ways of reducing how much they take up from your income can be found but it has its limits. Higher-income households have an advantage here as they can swap their non-essential spending to cover these necessities.

Not many small-income households have that opportunity.

It is very possible to have a case whereby the cost of living becomes higher than the inflation rate.

Inflation is the measure of the purchasing power of money in an economy. The same is through for households.

A low-income family may spend much of their income on basic food items, rent and fuel for example. The cost of living for these families would easily be higher than inflation if the cost of these essentials increases at a faster pace than inflation.

The cost of living has been increasing faster than inflation for some basic essentials. Jack Monroe, a food campaigner said basic foods rose higher than the official inflation rate between 2021 and 2022.

However, this year, higher-income households have experienced higher inflation rates than low-income families. The reasons for this are simple.

Higher-income households tend to spend more to maintain their standard of living. This means spending more on transportation as they use personal cars instead of the public transport system.

The consequence here is spending more on fuel as the price of motor fuels has drastically increased over the past year.

Other areas higher-income households are spending more on are energy, recreation, hotels, restaurants, and lifestyle.

5.  How Government policies are helping

The Chancellor announced measures taken to support households in February, March, and May 2022. The support was estimated at £37 billion and includes:

  • Given a £400 relief off energy bills for households
  • Households receiving means-tested benefits were given £650 plus a £300 payment for pensioners and people receiving disability payments were given £150
  • Giving a 5p cut to fuel duty
  • Households in council tax band A-D were given a £150 tax rebate
  • The threshold at which NICs charged on earnings was increased

Both National Insurance contributions (NICs) and income tax experienced tax rises by the Government in April 2022. The net level of government during this period is estimated to reach about £14 billion in 2022/23 when the changes are included.

In May 2022, 88% of adults in Great Britain experienced a rise in their cost of living, according to the office of the National Statistics.

Office for Budget Responsibility (OBR) in its March 2022 forecast suggested that household income taxes after tax and adjusted for inflation to begin lowering in Q2 2022 will not recover till Q3 2024.

Since lower-income families spend more of their income on energy, food, and transport, they are expected to be affected more by the changes in the cost of living. That is why the recent Government support for households was created around benefiting lower-income households the most.

According to the Resolution Foundation, the measures in place by the Government to support households will remove 82% of the rise in households’ energy costs in 2022-2023. This number is expected to increase to over 90% for poorer households.

Low-income households spend a larger proportion than average on energy and food so will be more affected by price increases. Overall, recent Government support for households benefits low-income households the most.

The Resolution Foundation estimate that the measures announced to support households this year will “in effect offset 82 per cent of the rise in households’ energy costs in 2022-23, rising to over 90 per cent for poorer households”.

 

Shrinkflation knock-on effect of inflation

When inflation happens, companies and brands tend to compensate for the lower purchasing power of customers with shrinkflation. Companies intentionally reduce the size of their products so it is still affordable for all.

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13 Ways on How to Spend Less and Save More Money for Investing

Most times, the problem when it comes to money is that lots of people tend to neglect savings and investment and concentrate more on expenses. Although it is more fun and easier to spend all the money you laboured for within a short period but the sad truth is that there are lots of reasons why you need to spend less and save more money to invest for the future.

Stay on this article as we guide you on the ways you can reduce spending and increase savings and investment:

1. Track Your Financial Growth

Calculating your net worth will help you to determine an overview of your financial standing. Net worth is determined as, your assets which include; investment, savings and cash in checking, real estate etc. minus your debts like mortgage, overdue credit card bills, student loans, etc. By doing this each year, you will be able to monitor your progression towards any debt repayment goals and savings.

2. Make a Budget

Another thing you need to do is that you need to have a realistic budget that you stick to. You need to be intentional about your savings goal and not only think about it. This includes you being realistic about your current household financial situation. You then need to set numbers that are attainable and correspond to your spending to enable you to save.

When you know what you are spending money on, you will likely not overspend. Monzo and Starling are two digital banks that can you with this.

There are also free budgeting apps like Money Dashboard that can help you manage all your accounts in one place.

3. Pay Attention To The Cash Flow Concept

Understanding what cash flow is, how it works and what your household financial situation looks like is very essential. Revise your expenses and your income then determine your savings habit.

4. Work With Your Partner

If you have someone you stay with, or you are married, teamwork and communication about your household finances are very important. To save and invest more, you both need to be on the same page with your plan, desire, and resources.

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5. Differentiate Between your “Want” and “Need”

Understanding the differences between your wants and needs. Identifying them will help you to avoid unnecessary expenses and help you say NO when something that does not correspond with your financial goal comes up.

6. Cancel Redundant Subscriptions

The thing with subscriptions is that they tend to pile up. Before you know it, those little subscriptions have become very expensive.

The Covid-19 lockdown and the work from home period gave people a lot of free time and subscriptions could have piled up. Now you have to ask yourself if you really need Netflix, Disney+, and Amazon Prime accounts?

7. Save First, Spend Later

When we make money, it is really important to save first before trying to sort anything else.

The rule of thumb is to use the 50/30/20 flexible approach to budgeting. What this means is simple. 50% goes to your needs like food, bills and debt. 30% goes wants. These are things you want to buy. 20% goes for savings and financial goals.

You can always adjust the ratios to what works best for you.

8. Pay Attention To Your Accounts

Do you know about tax-free ISA allowance? You can take advantage of your £20,000 tax-free ISA allowance. ISA rates aren’t great but it makes sense if you leave the money untouched for a long period.

You can get more information about it here www.gov.uk/individual-savings-accounts. You can find the best cash ISA rates at Moneyfacts.

Secure your accounts by turning on multi-factor authentication on all of your accounts to provide an extra layer of security. To do this, first protect your money and yourself by knowing where all your account is which includes; credit cards, retirements, banking, and student loan

Also, there are several safety precautions you can take which includes; setting up credit report monitoring, etc.

9. Improve Your Financial Credit Score

To increase your credit score, the most important thing you need to do is to keep your credit utilization rate under 30%. You also need to pay off your bills on time as at when due.

Lots of credit companies pay attention to your account on the length of your credit history, the mix of credit accounts you use, and the last time you applied for new credit.

10. Plan For Your Benefits

You probably have employer’s benefits that you are not aware of. Some of these include wellness opportunities, gym reimbursements, or financial planning sessions.

Make sure you pay attention to them by taking a few minutes through your HR portal or reaching out directly to your benefits manager can yield positive results.

You should take time out to find out the benefits your employer offer.

11. Be A Clever Customer, Not Loyal

It is easy to get attached to brands. But are they always the best option for you. The truth is, the emotional connection we have to brands apart, cheaper doesn’t always mean worse.

Sometimes, cheaper could be better and more suited to your needs.

To save more, you really have to be more clever with your brands and vendors. You can use comparison sites to search for better deals.

12. Maximize Your Savings Potential

Your rate of savings is determined by the percentage of income that you keep every month concerning your expenses i.e. Income – Expenses = Savings.

By increasing your savings, you are putting yourself in a better overall financial position. This will give you extra money at hand to save or to accomplish your goal, be it to invest or buy a house.

There are several ways to increase your savings, you can unimportant monthly subscription, get a side hustle, ask for a raise at work and more.

13. Reduce your expenses

This is another way you can save more by making sure that you are spending only what is important.

You can do this by making a list of all of your non-essential expenses for the last month. How do you achieve this? You can keep track of your expenses for a few months.

Rank them from the most important to least important and reduce or cut spending on the least important or unnecessary.

Conclusion

There are several ways you can spend less money than you make. But most of them rely on you either making more money or reducing your expenses.

The methods discussed are proven ways of reducing your spending so you can have more money saved for investing.

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