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Beware phoney deals

 
 

Hey Heroes!

Today we’re thinking about the wisdom of Sir David Brailsford – the British cycling coach who came up with the concept of ‘marginal gains’.

His winning idea was that, by making just a 1% improvement to each small component of riding a bike, the overall performance increase would be significant.

And that’s how we like to think about personal finance. 

Small gains here and there can amount to something much more significant in time. So no matter how tiny a financial-habit-tweak is, it all counts towards that overall performance increase!

  NEWS CATCH-UP
  • Royal Mail names areas hit by Covid postal delays  Read more
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  • Morrisons to be first UK supermarket to pay minimum £10 an hour  Read more

Sam’s Savings

 

Beware phoney deals

I write this in the midst of a household crisis.
 
My partner’s smartphone has broken!
 
(I think you’ll all concur that in the twenty-first century, that does indeed fall under the ‘crisis’ category…)
 
Having been on the phone to the brand’s customer services department, she quickly discovered that it’s out of warranty and the issue would cost over £250 to fix – albeit only temporarily.
 
Hard pass. So begins an evening of research…
 
We begin where everyone should in a similar situation: choosing whether to enter into a contract and receive the mobile for free (or a nominal fee) or to buy a SIM-free phone outright and take out a pay-as-you-go contract.
 
First, we run the numbers.
 
I can’t be entirely sure Abraham Lincoln wasn’t talking about Android vs iPhones when he said “A house divided against itself cannot stand” but in our home, we’re happily split down the middle – she’s a fan of Apple, me not so much.
 
With her heart set on the iPhone 11, we find a site offering the handset – with a price-match guarantee, importantly – for £599, SIM-free.
 
There are great PAYG SIM deals out there for unlimited minutes and probably more data than you need; a quick scan shows several good options for no more than £10 a month.
 
So, a tenner monthly over two years – the length of time most contracts lock you into – works out to £240. Add that on to the cost of buying the phone outright, and we’re looking at an outlay of £839 over 24 months.
 
By contrast, scouting around what the major networks are offering for their contracts, the absolute cheapest I can find at the time of writing for the same phone is £869 (£149 upfront, £30 per month), though many, many more are in excess of £900.
 
A saving of £30 minimum is nothing to dismiss – it all adds up! So naturally we opted for the cheaper, PAYG route.
 
A few clicks later – purchasing through a cashback site, of course, to make the deal even sweeter – and the phone is due to arrive tomorrow with next-day delivery.
 
Crisis averted!
 

More of Sam’s top tips when buying a new mobile phone:

  • It’s often far better value to look at previously released models rather than the latest one to enter the market – they’ll likely have most of the bells and whistles of the newest version, just without the hefty price tag that takes advantage of those who want the latest and shiniest release!
  • I’ve found the prime benefit of rolling 30-day contracts is that networks will compete to offer increasingly lower prices, and consumers are free to switch to a cheaper alternative to save yet more money, as they’re not locked in to an 18- or 24-month contract at a fixed rate!

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   FINANCIAL TIP! 

Setting challenges at the start of the year isn’t a new idea… but if you’ve missed the boat on Dry January or Veganuary, there’s still time to join in on this 52-week savings challenge.

(Well, it’s already the second week of January, so technically a 51-week challenge!)

The aim of the challenge is to set aside a certain amount every week matching the week of the year. So in week one of the year, £1 is set aside, then £2 in week two and so on. While the challenge is very easy to begin with, it gets harder later in the year, when saving £40 to £50 a week. 

But, by 31st December it would amount to an overall saving of £1,378!

This challenge can also be undertaken by saving pennies each day – a little easier on the budget but still ends up with a total of £668 saved by the end of the year. Not to be sniffed at!

We asked, you answered…

Poll taken by @MyWalletHeroUK on Twitter from 2:17pm 05/01/21 over a period of 24 hours.

According to the British Coffee Association we now drink approximately 95 million cups of coffee a day in the UK.

Home coffee machines are becoming increasingly popular for making espresso-based beverages, but are they really worth the investment?

If you’re a fan of instant coffee then perhaps not. But if you enjoy treating yourself to a daily drink from a coffee shop, you might want to see these numbers…

We’ve done the maths, and were pleasantly surprised to see how affordable investing in a Nespresso machine could be by comparison.

Nespresso Pixie original machine:   £139.99  
Coffee pod cost:   35p
Annual cost of a coffee a day:   £267.74 

Starbucks espresso:   £1.90
Annual cost of a coffee a day:   £693.50

Over the course of a year, that’s a saving of £425.76, which would pay for the machine itself and still leave plenty of extra money.

Content Disclaimer: We have taken reasonable steps to ensure that any information provided is accurate at the time of publishing. The content provided in this article has not taken into account the circumstances of any specific individual, and does not constitute personal advice or a personal recommendation for any individual; neither should it be relied upon by any individual when making any decisions. If you require any personal advice or personal recommendation, please speak to an appropriate qualified adviser.

 

Thanks for joining us today Heroes, we’ll have more money musings winging their way to your inbox soon!

Written by the MyWalletHero Team.