• Hayley Leith

Easy Tips For Saving Money & Managing Your Spending

Updated: Aug 4


Learn how to save money and budget effectively with our essential money-saving tips.


When looking to apply for a mortgage, or any type of credit, lenders will assess your credit history and bank statements to find out whether or not you are reliable with your money. One of the things that they will look at is your spending habits, and how sensible (or frivolous) you are with your finances. So here are 10 tips to help you save money and manage your spending before applying for a mortgage.



1. Stop buying everything new

It goes without saying, buying products new and fresh out of the packet will, most of the time, cost more than buying the same product second-hand or refurbished. Of course, not everything you will want to buy second-hand, but it’s a great place to start when looking to save some money.


For items such as furniture, white goods, and clothing, there are a variety of websites where you can both buy and sell with people in your local area, such as Facebook’s ‘Marketplace’ tab, and forum-based websites Freecycle and Freegle. You’ll be surprised to find what quality items people are often selling for low prices or even simply giving away for free. Similarly, if you prefer to do your shopping in person and have the time for it, you can often find great deals on unique items at car-boot sales and auction houses.


If you’re the type of person who loves a bit of retail therapy, or you prefer to buy name-brand clothing (which can get very pricey), consider taking a trip to your local vintage stores or charity shops. With the growing popularity of buying ‘vintage’ over the past few years, especially with the emphasis on how damaging clothing manufacturing is for the environment, the offering of vintage stores has improved tenfold. It won’t take you long to find a high-end brand item for a fraction of the original price. If you’re looking to get even more for your money, look up when the next vintage kilo sale is happening in your area - these usually work on a clothing weight basis, rather than pricing each item individually. It’s a great way to find quality pieces such as denim items, coats, sweatshirts and bags, all at a lower price than you would usually pay. Besides saving money on what you purchase, you’re also helping the planet by reducing the amount of waste that goes to landfill - a win-win!



2. Check your subscriptions

When looking at your bank statements just like a lender would, hunt down all of the direct debits that you’re paying each month and find out what they’re for. These could be subscriptions to services such as streaming platforms, mobile phone contracts, or loyalty schemes you weren’t even aware you were signed up to. Once you’ve identified what they are for, weigh up the necessity of each and cancel any that you no longer need or want. For example, if you find that you are paying for 3 different streaming platforms but only really use one of them regularly, consider cancelling your other subscriptions. Similarly, you could also do a little research to see whether there is another option for streaming that includes more of what you want to watch from each.



3. Review your contracts

More often than not, people will be paying far more than they should be for amenities such as energy and broadband. Therefore, it’s worthwhile to review the contracts that you have each year and see if you can get any better deals for the same product elsewhere. This sentiment equally applies to your insurance, where the price may fluctuate as time goes on and you can end up paying more than necessary since you never questioned it.



4. Set yourself a budget

When it comes to recreational spendings, such as clothing, technology and going out, it’s always a great idea to set yourself a monthly budget - and stick to it. By creating a budget, you can easily split up and allocate your additional funds into what you are most likely to spend your money on, setting out a clear plan and staying on top of your finances. If you discover that you’ve gone over your budget one month, then adjust the following month’s budget to accommodate for this oversight so that you never find yourself spending more than your means.


Many people spend money that they don’t need to by falling into bad spending habits. The savings that you could make by cutting back might include:

  • £1,248 per year, by drinking instant coffee at work instead of sipping on those weekday Costa coffees

  • £800 per year when you take a packed lunch to work instead of buying a Tesco meal deal

  • Up to thousands of pounds per year by wasting less food and buying more economically. Plan your meals ahead of time and buy cheaper brands - you really can eat well for less. Here’s a shopping tip: always take a list with you, and only buy what’s on the list.


For additional, in-depth advice on how to successfully budget, this article from MoneySavingExpert covers many different scenarios as well as offering a free budget planner template to help you get on track.



5. Sign up to a cashback platform

If you find yourself to be purchasing a lot online, a great way to save money is to create an account with a cashback platform. These platforms pay you a cash reward when you click through from them to buy goods or financial products. Websites such as Quidco and TopCashback offer cashback on a variety of goods and services, from mobile phones and clothing to car insurance and broadband. The majority of cashback sites work in the same way, only differing in fees, joining bonuses and how the money is paid. Have a look at a few and find one which you think is the right one for the types of products that you purchase online.


For example, Quidco offers the option to cash out directly to your bank account once you’ve collected over a certain amount of cashback, in addition to also offering slightly higher amounts if you instead choose to convert your cashback into a gift card for a specific store (e.g. Amazon, Deliveroo, Asos, Sainsbury’s etc.).


Depending on how frequently you purchase online and the amount of money that you spend, you could amass a decent amount of cashback within a few months.



6. Make use of loyalty schemes and rewards programmes

If you find yourself purchasing from the same store often, it could be beneficial to see if they offer a loyalty scheme that will reward you for spending your money with them. For example, major supermarkets Tesco and Sainbury’s both offer a points-based loyalty scheme, where you can redeem points that you collect to get a discount on your purchases. Similarly, signing up to mailing lists of your favourite stores can be a great way to receive discount codes, as well as using coupon plug-in sites such as Honey that will automatically search the internet and test applicable coupon codes for you when purchasing online.



7. Monetise your assets

Instead of potentially taking on a second job or working longer hours, consider how you could use your assets better to make money. There are plenty of people making ‘free money’ by renting out their unused driveway as a commuter’s car parking space. Similarly, did you know that your spare bedroom could be worth as much as £7,500 per year to you - tax-free? (See the ‘Rent-a-Room Scheme’ for more information). It’s worth the effort to sit down and think about what assets you have that you could utilise in a similar way, and you could easily be on your way to finding an additional income.



8. Reduce your tax bill

Relatively few people are aware of all of the tax relief schemes that are available, and even more so which you are entitled to claim. Reliefs such as the rent-a-room scheme, annual investment allowance (AIA), and potentially exempt transfers (PETs) are all ways to help you save heaps of money.


To find out more, this guide by Which? covers all of the obscure tax reliefs you need to know about.



9. Plan your expenses in advance

Most people end up spending money on the same things each month without ever factoring these costs into their budget, with them instead eating into their disposable income. Start by taking note of your essential spends during a regular week - these could be expenses such as train tickets, parking fees, etc., - and recognising which of these costs are essential and recurring, that way you can factor this total into your weekly or monthly budget and have a clear idea of your actual disposable income.


In addition to those hidden costs eating away at your income, it is easy to forget about annual events such as birthdays, anniversaries and festive holidays that could cost you quite a bit if you don’t budget for them. It’s useful to add a general ‘gifts’ allowance to your budget each month that could help to cover those expenses, of which the amount would be up to your own discretion.



10. Eco home upgrades

For saving money on a longer-term basis, consider investing some money into upgrading your home with energy saving measures. There is plenty you can do inside your home that will boost its eco-friendly credentials whilst saving you money; from choosing furniture that lasts to installing energy-efficient lighting. When looking at these measures, insulating your loft is a great first step, as your home can easily lose heat through the roof. According to Channel 4’s George Clarke, homeowners usually recover the average £300 cost of loft insulation within two to three years of installation, saving on the costs of heating their home in the long run.


none of the products or services mentioned in this article are sponsored or endorsed, they have simply been included as examples and suggestions to be used at your discretion.


If you take on at least a couple of these ideas, you could find yourself saving a lot of money in the long-run and appearing as financially responsible to lenders. If you’re thinking about applying for mortgage, contact Mortgage Thoughts today for specialist advice with you in mind.



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