How to have more money

Financial traps: 10 most commonly accepted deadly rip offs

Posted on April 19, 2017

This is a simple list of very simple tools you can stop being ripped off. these are well known ripoffs most of the company are using and by a few actions you can save £100 or £1000.

  1. Insurance renewals

    1. Always deselect auto renewal when buying any type of insurance. 9 out of 10 it will not be cheaper
    2. If you don’t have this option ring the insurance company and ask them to do not auto renew
    3. You can always be loyal and chose your existing insurer but it is better doing it having checked if they are competitive
    4. they will always send you some kind of reminder so do not worry if you think you will forget
  2. Joining gym in January

    1. Everybody knows that after having tons of food and  drinks during Christmas you want to join the gym. Gyms knop it and you will sign up for a yearly contract at the high price. you might not even use the gym after the first month
    2. If you want to join the gym select summer time and make sure you don’t sing up for more than 3 or 6 months unless the gym offers you financial incentives
    3. If you really want to lose some weight after christmas, go for the jog or walk, eat less during January and February and keep your motivation to join the gym. Delayed satisfaction is much more motivating so when you join the gym you will be more disciplined to train.
  3. Being loyal to utility or broadband Provider

    1. always shop online for utilities and broadband every year
    2. Always check what are the best offers and haggle as much as you want
    3. You should not pay for a good broadband with phone line and TV over £40 per month
  4. Prepaid cards for energy

    1. They are sometimes 50% higher than any contract paid ion direct debit
    2. It is not that difficult to sign up for the contract
    3. Early cancellation fees for quitting contracts are very low around £30 per fuels. So signing up for a year will be much cheaper tha prepaid cards
  5. Not paying minimums bill on your credit cards

    1. Always pay your minimum credit card bill
    2. It is very expensive not to
    3. Your credit history might be affected
  6. Buying extended warranty for your appliances below £100 such as electric kettle, alarm o’clock, toaster etc.

    1. It just does not make send paying 30% of the value of the product for ‘extended insurance’ for the product which you will buy again in 2 or 3 years
    2. You have the chance to buy another type of product
    3. Nobody really knows how they work
    4. they are good for more expensive products you are likely to have for more than 3-5 years
  7. Buying car insurance from the local broker without checking online

    1. Unfortunately local brokers are less competitive
    2. It is not the rule so always check them and check online
  8. To go shopping while being hungry

    1. No comments here, if you are hungry and go grocery shopping you will buy food you don’t need
  9. Buying petrol or diesel on motorway services

    1. Food at motorway services is generally 10%-20% more expensive. This goes up at night.
    2. Buy a minimum if you have to and don’t have time and refill up to full tank when you get off the motorway.
  10. Using overdraft

    1. It is a good utility to have but don’t use it
    2. It is easy to get into the expensive small debt trap

Personal budgeting: How to use budgeting tools and tricks to save £1000s

Posted on April 8, 2017

Budgeting is the simple but powerful technique used by all the successful companies and people so why don’t we copy this and implement in our daily lives. You do not need an extensive accounting background , software or books and if you follow the simple 7 step process below you will have much better visibility of your money and you can start saving £100s if not £1000s. This is my simple 7 step strategy:

  1. Write down how much money you have

    This seem obvious but many people do not even know how much they are in debt or how much money they currently have. Having outstanding balance on credit card and mortgage do not help but I would advice to ignore the amount of mortgage and concentrate on monthly spending only. Check the balance of your :

    • credit cards
    • current account
    • short term loans
    • cash
    • ISAs
    • all other accounts which are changing on the monthly basis and write down the final sum.
  2. Estimate what you will need in the next month

    since the direct debit use it is not simple to know how much money we are actually spending. they just disappear from our account which is convenient but somehow we end up with no money.  In this step you have o make sure to include every single amount of spend which you are planning to spend in the next 30 days including:

    • all utility bills
    • all taxes
    • TV licence
    • mobile bills (including insurance)
    • car bills (MOT, taxes, insurances, etc)
    • petrol
    • clothes
    • food
    • lottery
    • gifts
    • special purchases
    • any ebay or amazon purchase
    • any Paypal spending
    • estimate of at least $200 for back up (in case you have the above number wrong)
    • any amount you spend
    • estimate you small purchases such as: drinks, sweets, cigarettes if you smoke etc
    • Estimate what will be your nett income for the next month
  3. Estimate how much you are going to earn in the next month

    This should be simple step if you have only one job that pays the same amount monthly however there are people on different contracts with many jobs and they can not estimate therefore I would just guess based on historical amounts from previous month and apply some kind of probability factor.  Any amount is better than nothing. So write down the sum.

  4. Always have the affordable back up amount in your budget

    I always suggest to have £200 as the back up when you are starting this budgeting process. You will need a few month to get this right. also it helps in managing unplanned spendings such as: repairs, impulse buying etc. The good news is when you don’t use your back up fund you can have some savings. Remember this process is not to limit you in anyway, I always believe that you should buy what you want. This process will enable you to buy what you want. All you need is to plan it in advance. There is plenty of tools and apps you can use starting from simple spreadsheet to some sophisticated apps you can use but it is very easy to surround yourself with fancy tools, plann it ll and …not use it. So to start this process I would suggest to start simple and teach yourself the budgeting approach. Backup is the key to fine tune your budgeting skills and master them. If you need some apps you can use these:IPhone apps, or these are other apps

  5. Calculate he balance

    The amount of money earned should be the same or higher than the estimated amount of money spent. This is the simplest possible way of laying down the principle of budgeting. There is no more to be said in this area but many people just hope to have some kind of magical powers to create more money or are waiting for the Family or an angel to hand them some money. I would suggest don’t join these people. If what you are planning to spend is within your reach and below your monthly earnings you will be OK, If something unexpected happened and you will have to pay for something unplanned at least you will have a better position because you planned all the rest.

  6. Make sure you spend only what you planned

    This step requires some discipline. You need to stick to your plans. Be careful with small amount spendings such as: drinks, sweets, icecreams, newspaper, bus tickets etc and make sure you allow the amount for such in your monthly plan. The first month will be your best teacher and use it as lesson learnt.

  7. Calculate the actual money earned and spent at the end of the month

    Look what happened in the first month and see how much far from your plan you ended up. Use it as lesson learnt and try to improve your budgeting skills for the following month. It is never ending learning curve but it will help you to control your money without nasty surprises at the end of the month. Remember: it is about doing what you want and spending money on what you want

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