The majority of people know that it’s important to save and invest money for the future. Yet at the same time, research shows that many people are actually finding it quite hard to save anything in the current environment, which means they’re not able to invest.
Here, I want to look at five simple saving tips that could help you free up a bit of spare cash for, say, a Stocks and Shares ISA. Could these ideas allow you to invest for the future?
Food can consume a large proportion of your paycheque. But there are ways to bring food costs down, without having to live off a diet of bread and water. One easy to way to slash costs is to shop at discount supermarkets such as Aldi or Lidl. These supermarkets could save you a fortune.
Whenever I drop into my closest Aldi or Lidl, I find that a basket of goods costs nearly £10 less than the same basket of goods would cost at Tesco or Sainsbury’s. That’s a big difference. Over time, this kind of saving can add up. Shopping at a discount supermarket could potentially save you £500 per year which could then be put towards investing.
Your phone bill is another expense that can be easy to cut down. All too often, people sign up to a 24-month plan in order to get their hands on a new phone. Yet they continue paying the same monthly fee after the 24-month period ends because they don’t realise they could switch to a cheaper plan. By switching to a SIM-only plan after your contract expires, you could reduce your monthly phone bill to £15 or less and potentially save another £300+ per year.
If you’re currently paying for an expensive TV package with Sky or Virgin, you could also consider cutting this out and replacing it with Netflix which costs just £7.99 per month. Netflix offers an incredible selection of content these days, meaning it’s unlikely you’ll miss your old entertainment package.
Your health is obviously important, but many people don’t get value for money from their gym memberships. As such, you could be better off pocketing your gym fees, getting yourself some decent athletic shoes, and exercising outdoors. You could even consider cycling, running or walking to work, which could also cut down travel expenses. This could be another £500 saved per year that could be put towards investments.
Finally, selling things on eBay could also make a big difference your savings situation. You could be surprised at just how much money you could make. Over the years, I’ve sold everything from books to old, used trainers. As they say, one man’s trash is another man’s treasure. Conversely, if there’s something you’re looking to buy, check out eBay first, as you may be able to find it for a fraction of the price you were expecting to pay.
Of course, when it comes to setting yourself up for the future, saving money is just the first step. You also need to get that money working hard for you by investing it into growth assets such as shares and funds that will grow at a faster pace than inflation over time. If you’re looking for ideas on how to grow your savings, you’ve come to the right place.
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Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.