Everyone is looking to save a bit of money as the new year begins. With all of the extra money spent at Christmas, the continuing cost of living crisis, and so many between the last payday and the next one, is unsurprising that many people are looking to save money where the can – and are looking to make a little extra.
Ever the fountain of financial wisdom, Money Saving Expert (MSE) – the organisation founded by Martin Lewis to bring financial freedom to all – has put together a list of quick and easy money saving tips to gently ease you into saving some extra pennies this year.
From possible tax breaks, to simple water saving advice, the MSE team are committed to helping you save where you can. The team at the website have put together more than a dozen ways to kick 2023 off with a financial boost.
1. Married couples could be entitled to £1,242
Couples who are married or in civil partnerships could be receive a big tax break, worth potentially hundreds of pounds. To qualify, one member of the couple must be earning below the tax threshold (earning below £12,570 every year), and the other must be a basic 20 percent rate taxpayer (earning between £12,570 and £50,270 per year).
The non-tax payer can apply to move 10 per cent of the tax free allowance to their spouse, which MSE say is worth £252 this year. This is back-datable up to four years, totalling an extra £990 in your pocket. You can apply at Gov.uk though MSE recommends to read the full pros and cons list in it’s Marriage tax help guide first.
2. Earn cashback with your debit card
If a cashback credit card isn’t for you, for whatever reason, MSE recommends the Chase bank account app for it’s one per cent cashback on everyday spending for a period of 12 months. All banking is done through the app, there’s no credit check, and you do not need to complete a full bank switch in order to earn one percent back on your shopping.
There are other banks offering debit cards with cashback out there, though the exact amount of money you’ll see returned varies by bank.
3. Check benefit eligibility if you earn less than £40,000
MSE say an estimated seven million people are missing out on benefits they could be entitled to. They say: “Martin’s rule of thumb is all households earning under £40,000 should check – he’s not saying you’ll get it, just it’s worth the time on a benefits calculator.”
It takes minutes and could see you nab an extra £500 per month to boost your income during the cost of living crisis – that could be life changing for many.
4. Save water to save money
Following a scorching hot summer last year, water firms are handing out free water saving gadgets, including showerheads, tap inserts, and winter insulation kits. To find out if you can get your hands on any, you can check at Save Water Save Money.
Because a good chunk of water used is also heated, this could also save you on your energy bills. MSE also recommend looking into switching to a water meter? – some save £100s.
5. Could you halve your broadband bills?
MSE say: “Many on older contracts are paying £30 to £45/month for slow broadband. Yet two minutes on our broadband comparison can often find deals saving £200+/year, at faster speeds. To put that in context, you can get superfast fibre broadband for less than £19/month.”
6. Universal Credit claimants could get special broadband deals
Only a small portion of the four million people eligible are claiming these long-term cheap deals – MSE have their own list, for to get you started, Virgin Media, BT, and Vodafone all have deals online.
7. Switch your savings if you’re not getting at least 2.85 percent
Saving rates increasing were one of the few good financial outcomes of 2022 – but they are still being swamped by inflation rates. MSE say it’s therefore vital to make sure you are getting the best interest rate going for your hard earned savings.
“For easy access, app-based Zopa’s 2.86% AER or for online Coventry Building Society’s 2.85% AER (max six free withdrawals a year, though rate rises to 3.25% on Fri 6 Jan). Many want a big name though, the top payer of which is Nationwide’s 2.5% AER* (max 3 free withdrawals a year). You can earn far more though if you’re prepared to lock cash away with the top one-year fix at 4.26%, two years at 4.54%. Full help in Top savings and Top cash ISAs.”
8. Get up to £2,000 in help with childcare costs
If you or your partner work, and you’re paying for childcare, you may be entitled for Tax Free Childcare, where the government tops up childcare costs by 20 percent, up to a maximum of £10,000 (so the government give you and extra £2,000). MSE suggest around 800,000 people aren’t claiming this benefit despite being eligible for them.
However, applying for Tax Free Childcare could leave you without other benefits, like Universal Credit and Tax Credits, so MSE recommends checking carefully before applying.
9. Save on your car and home insurance
While insurers are restricted from charging long-term customers more than new ones, comparing and switching your provider could save you some money. The MSE car insurance Compare Tool will show you the cheapest quite possible, and even tell you how to reduce it further.
MSE say big savings can also be made on your home insurance. “See our cheap home insurance cost-cutting system for full help, though here are a few key tips:
10. Are you owed tax back?
Millions are paying the wrong amount of tax every year, and the rules say it is your responsibility to double check how much you are paying. Your tax code is the short number – such as 1257L – that tells your employer how much tax to take from you.
For more information on tax underpayments and overpayments, visit the government website.
11. Put some money in a LISA
A Lifetime ISA allows first time home buyers (those aged 18-39 upon opening) save towards their first home, worth up to £450,000. These ISAs are a fantastic way to save, as you receive both interest and a 25 per cent top up on whatever you put in.
However, it needs to be open for at least a year before you start amassing any interest, so even if you’re not yet thinking about buying a home, it’s worth popping some money in there – and if you don’t buy, you can always use it in your retirement.
12. If you can’t afford to pay off your credit card in full, see if you can transfer to a zero per cent card
MSE say: “A balance transfer credit card lets you shift existing debt to a new card, so you owe it instead, but it’s interest-free for up to 30 months. Acceptance is the problem, so spend two minutes on our Balance Transfer Eligibility Calculator to see which top cards you’re most likely to be accepted for. Aim for the longest 0% deal to pay off your debt, then look for the lowest fee.”
13. Grab tax back if you wear a uniform to work.
If you’re responsible for washing, repairing or replacing your uniform, you could claim a tax rebate on the expenses you incur, going back as much as five years. It’s not huge but backdated can be £60 (£120 for higher-rate taxpayers).
14. Click into your online banking and check your direct debits and standing orders
A fresh scroll of your outgoings is often a good way to limit your spending on services you no longer use, want, or need. Think unused streaming subscriptions, gym memberships or insurance. So it’s always worth checking – it’s easy to do with most online banks.
15. Are you in the wrong council tax band?
It’s thought 100,000s of homes in England and Scotland are in the wrong band. Re-banding isn’t quick, but the provisional checks to see if it’s worth it are:
- Neighbours check. Use Gov.uk (Eng) or Scottish Assessors (Scot) to compare your band to neighbours’ in similar or identical homes.
- Valuation check. If that says you may be in the wrong band, use our valuation check to work out what your home’s 1991 value would be (as that’s what counts for council tax).
If they’re looking good, it’s important you read MSE’s full council tax check & challenge system to see whether it’s worth you challenging your band – don’t just go for it, as there are risks.
16. Do you qualify for a council tax discount?
If you’re the only adult in the home, have a disability, ‘severe mental impairment’, low income, or a carer (or you are one yourself), check our guide to see if you’re eligible for a discount.
17. Get free help with serious debt
If you can’t meet your minimum repayments, or your debts (not mortgage or student loan) are bigger than a year’s after-tax income, or you’re having sleepless nights over debt, then go to a free non-profit debt advice agency ASAP (though admittedly they’re rammed this time of year). These include Citizens Advice, National Debtline, StepChange, which also runs an online debt advice service or, for emotional counselling too, CAP.