You might think you’re alright with money, but there’s a good chance you’re doing (or not doing) one of the following – and it could be costing you hundreds of pounds!
1. Paying for something you don’t use
Netflix? The gym? If you’re paying for them but not using them, it’s an obvious waste of money. Especially if you only signed up for the free trial but forgot to cancel!
Worse though are annual subscriptions that you forget about and let auto-renew. Insurance is the worst for this, but it’s easy to do with services like Amazon Prime and Tastecard too.
If you cancel the service straight away, you can always sign up again. For year long policies, make a note for 5 weeks before you’re due to renew. That’ll give you more time to find alternatives or meet any notice period required.
2. Putting money into savings when you have debts to pay
It’s always worth having an emergency fund, but with interest rates so low on savings, there’s very little chance you’ll be making more than the interest adding up on any money you owe.
Think of it this way.
£1,000 on a credit card with an interest rate of 19% (and making a 3% minimum repayment each month) will add £170 in the first year. Plus you’ll pay interest on the interest and take forever to pay it off.
£1,000 in a high-interest current account earning 5% will net you £40 after tax. That’s £130 you’ve lost in one year.
You can also save on credit card interest by transferring the balance to a 0% card.
3. Not using cashback sites
The big money though is on insurance, mobile contracts and broadband/TV deals. You can get hundreds of pounds – I did!
You can also top this up if have a cashback credit card or bank account.
4. Not switching banks
Does your bank do anything for you? If you’re not getting high interest on savings or cashback, there are very few reasons to stay loyal – and some banks will offer you a triple digit bonus for switching.
An easy win is with Halifax which offers a £125 bonus for moving your current account to them, then an extra £5 a month – but there are dozens of other great deals available from other banks.
5. Rolling over contracts
When you come to the end of a contract for a bill like gas or broadband you’ll be automatically moved onto a rolling contract. More likely than not it’ll cost you more each month.
Mobile phones are among the worst as most contracts include paying for a handset. At the end of your 18 or 24 months you’ll have paid off the phone, but if you don’t upgrade or renegotiate your monthly fee, you’re paying for the phone AGAIN!