How fixing holes in your finances could save you money
Published 4 June 2013 by Joel Stanier
New research has shed some light on some of the most common 'money leaks' that are costing people money that could have been saved. What can you do to keep your finances watertight?
New research has shed some light on the most common 'money leaks' that are costing people money they could have saved.
According to research for Gocompare.com, many people are paying out unnecessarily for forgotten financial arrangements, avoidable charges and overpaid direct debits, among other things.
By far the most common 'money leak' is overpaying on energy bill direct debits and building up a credit - with 47% having done this at some point in the past. 39% said they had done the same with telephone bills.
Meanwhile, 24% said they have paid fees at a cash machine, and 18% have paid avoidable interest or annual charges on a credit card. And some 10% have paid out for direct debits that should have already been cancelled.
So what can you do to make sure your finances are waterproof?
Tips for avoiding 'money leaks'
Don't let insurance automatically renew
Most of us know we could save money by switching car or home insurance each year, yet many people simply let their existing policy renew. In the case of car insurance, this can sometimes add hundreds to the total amount paid - so make sure you compare deals a few weeks before your policy is due to end.
Try to pay off your credit card each month
Interest can soon mount up on credit cards unless you pay off the balance in full each month - so it's always best to pay off credit card debts as soon as possible.
Is it time to cancel that unused gym membership?
Some of us keep our gym membership running in the vain hope we'll suddenly feel like leaping off the sofa and going for a run on the treadmill. But if you really don't think you're going to use it, cancelling your membership could save you a lot of money.
Make sure old direct debits are cancelled
Contact your bank account provider whenever you finish paying for something by direct debit to make sure the arrangement has been cancelled. They should be cancelled automatically, but there have been cases where people continue to be charged without realising.
Stick to a budget
Keeping a close eye on your finances means you're less likely to miss things when they change, and a well-planned budget can make the job a whole lot easier.
If you don't feel comfortable managing your own budget, there are services that can help - such as the thinkmoney Managed Current Account. The account takes care of budgeting for you, by setting money aside for your bills and other living costs every time you get paid.