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20 Easy Ways To Reduce Your Spending

20 Easy Ways To Reduce Your Spending feature image

Published on:

Written by: Michael Barton

Published on:

Written by: Michael Barton

Michael has almost quarter of a century’s experience in the financial world. This includes trading and institutional sales trading, and in senior positions to VP of Global Equities, as well as Head of Trader Training, at companies including Merrill Lynch (SNC), Cargill Investor Services, and Goldman Sachs. Michael’s experience also extends to providing financial advice as a personal financial advisor in the UK.
This article has been fact checked by a member of the Wallet Savvy editorial team and complies with our editorial standards.

‘How can I stop spending?’ The good news is, you don’t have to stop completely. Here are 20 easy ways to reduce your spending and make your money go further in the long run.

We’ve all had that feeling of dismay (helplessness, even) when we look at our latest bank statement and ponder where our wages have disappeared, haven’t we? The spectre of debt raises its ugly head, just like it does every month. Is there no end to this spiral?

Yep, you need to cut your spending. You need to be smarter with your money.

I’m not talking about drastic changes that will flip your lifestyle on its head. You don’t need to live like Scrooge, counting every penny. Indeed, a few subtle changes to how you spend your money can make a significant difference to how much money slips through your fingers.

These 20 easy ways to reduce your spending will help you dodge the debt bullet, and leave you with money you never thought you had. It really is possible to live life to the full and save hundreds, if not thousands of pounds every year.

30-Second Summary

Whatever your reason for wanting to reduce your spending, it doesn’t have to be hard to do. Here are a few key takeaways from this article:

  • It’s crucial to track spending to identify where your money is going.
  • Create and follow a budget while prioritising savings.
  • Use tactics that help you most – these could include only spending cash, freezing your credit card (literally), and more.
  • As you reduce your spending, move your savings into a separate account so you can see the fruits of your efforts.

Finally, allow yourself an occasional reward – paid for by the savings you have made.

1. Track Your Spending

First things first – you need to get a handle on where your money is vanishing to, because you can’t manage what you don’t monitor. When you keep a tab on how you’re spending your money, it’s surprising what leaks you’ll find.

The old-style way to put this into action is by keeping a notebook of all your spending (every single penny) over a period of a couple of weeks or a month. Even that cheeky coffee before you get into the office, or that sneaky chocolate bar at the supermarket checkout. It all goes in your book.

Sounds like hard work? Then sign up to a budgeting app like Moneyhub, Emma, or Snoop. These will track your spending from connected cards automatically, separating into spending categories.

A real-time snapshot of your spending habits is eye-opening, and will help you make smarter choices about how you spend.

2. Budget, & Pay Yourself First

Time to create a map for your financial journey – a blueprint for spending wisely and saving with purpose. The magic happens when you turn traditional budgeting on its head and pay yourself first.

What does this mean? Instead of taking care of all your expenses and giving yourself a target amount to spend, put aside money to save or invest first. Make your financial future the priority.

Figure out how much you want to save each month, then consider your essential expenses (rent or mortgage, utilities, food, and travel) before you’re left with an amount you can spend.

Once you’ve done this, take yourself out of the equation by automating your saving, moving money from your current account to your savings or investment account the day after your salary is deposited into your current account.

Work your budget this way round, and you’ll build a financial cushion to act as a buffer whatever life throws at you, as well as taking care of your financial future.

3. Switch To Cash Only

If you find spending on a card is too easy, then go old-fashioned and change to cash only. When you get paid, take out how much you have allowed yourself as your spending money for the month. It’s easier to see cash in your pocket dwindling away with every purchase.

Delete your phone wallet. Put your cash spending allowance in your physical wallet, and leave your card at home. Once that cash is gone, it’s gone.

My son used to have a big problem with keeping his spending under control, and this was the method that worked best for him. It helped that he had a father who looked after his bank card for him!

4. Categorise With Envelopes

My parents used to separate their weekly wages into individual jars – one for the rent, one for electric, one for shopping, and so on. This is the envelope system of budgeting. Once the money is in its jar or envelope, you can’t touch it except for the use for which it is earmarked.

Today, you can use an app like Plum to manage this style of budget control. Define your budget into spending categories (like groceries, travel, utilities, entertainment, and so on), decide how much needs to go into each, and create a Plum Pocket for each category.

Transfer the money into these pockets when you get paid, and use the cash only when you spend money in that category. Once the cash is gone in each category, it’s gone.

(Tip: At the end of each month, sweep any money left from any category into a cash savings account. You’ll build up your savings instead of frittering away excess cash.)

5. Make A Frozen Card Vault

credit card in an ice cube

When you carry a credit card in your wallet, it’s easy to succumb to impulse buys, isn’t it? At the end of the month, you get a surprise with your credit card statement.

How the hell did you spend all that? Oh well, minimum payment it is this month… and so the debt spiral starts.

Here’s a novel way to stop yourself wracking up debt on your credit card – freeze it.

Literally. Put it in a small tub of water. Put the lid on it. Then pop it in the freezer!

Now, to get at that weapon of wealth destruction, you’ve got to put in a whole load of effort to chip away the ice. This is the cooling off period (pun intended) you need – you’ll soon start thinking twice about your higher-ticket impulse buys.

6. Apply The 24-Hour Rule

If you can’t face the trauma of freezing your credit card, leave it at home in a safe place. When you see something that takes your fancy, you’ll be forced to adopt the 24-hour rule.

It’s an easy concept – always give yourself a 24-hour window between temptation and purchase. This is the time you need to consider whether the item is a necessary purchase. You’ll often find that the temptation has passed – and you’ve kept your spending in check.

This 24-hour rule is one of the best methods to help you develop a more mindful approach to your money and your spending habits, and will show how disciplined you can be.

7.   Plan No-Spend Days/Months

Are you one of those people who look back at their card statements and see entries on almost or every day?

Break the habit of spending money every day, even if it’s on small things like a coffee or sandwich. Try planning at least one day a week that is a no-spend day. If you can, stretch this to two or three days.

Start by choosing a day each week and commit to not spending any money at all unless it is absolutely essential.

Take a homemade sandwich to work. Eat a home-cooked meal instead of a takeaway or restaurant visit. Look for free entertainment options, like a walk in the park.

Over time, you’ll find the urge lessens to spend on things you don’t need. Soon you’ll be up to four or five non-spending days each week, without thinking about it.

8. Unsubscribe From Temptation

Marketing emails are the digital marketers equivalent of point-of-purchase supermarkets displays: those shelves that contain tempting goodies while you wait to be served. Enticing offers delivered straight to your inbox swamp you with ‘buy triggers’.

The easiest way to avoid this temptation is to click on the unsubscribe link at the bottom of each marketing email. Let’s be honest, if you really wanted what the retailer was selling, you’ll surf the net to find the product or service yourself, wouldn’t you?

Remember, sneaky retailers are never on your side, and they’ll do virtually anything to make you want to buy something rather than leave you to buy what you need.

9. Remove Saved Credit Card Information

Here’s another sneaky way that online retailers entice you to spend more: they let you store your card details online to facilitate ‘one-click’ purchases. This makes it easier to complete a purchase, and when buying is easier we spend more – because we think less.

By not having those credit card details automatically completed in online shopping carts, you give yourself time to reconsider the purchase. Also, having to manually enter your card details can be stressful – often enough of a chore to make you say, “It’s not worth the hassle.”

So delete your card details from all your online accounts – retailers, food delivery services, eBay… all of them!

10. Cancel Unused Subscriptions

Subscription receipts from inactive users is a major win for companies. You sign up for a service, use them for a while, and then your use tails off to zero.

But the monthly subscription continues to leave your account. They’re a silent enemy picking off your account balance without you realising. Such subscriptions range from magazines to book clubs, streaming platforms to gym memberships.

By cancelling subscriptions you no longer use fully, you free up money to allocate to your savings. Set aside a few minutes each month to go through your bank and credit card statements, looking for recurring charges.

If you haven’t used that subscription in the last month, ask yourself if it’s worth keeping. If it isn’t, cancel it! You’ll be surprised how much money you could free up (the average is £226 a year, according to a 2023 YouGov survey).

11. The One-In/One-Out Rule

This is a rule that I love. It not only reduces spending, but prevents cluttering too. It’s simple to adopt, too – for every item you bring into your home, you must remove an item (by way of selling on, charity shops, recycling, etc.).

This encourages you to think about what you’re buying – do you really need that cardigan, coat, or new pair of shoes? Which item at home are you going to replace?

You’ll often find yourself saying, ‘I’ve already got one…’ Implement this rule, and you’ll find you spend less and your house is tidier.

12. Shop With A List

Impulse buys are a real wealth killer. Which is why Mrs B and I always use a list for our grocery shopping. It makes sure we only buy what we need, putting a stop to those spontaneous pocket pinchers.

It also saves us time in the supermarkets (great news for me, as I loathe shopping).

To put this into action, plan your meals ahead and take stock of what you have in your fridge, freezer, and cupboards. Then make a list of the items you need. Add other domestic goods that you need to your list.

As you walk around the shops, cross each item off the list as you put it in your trolley. Keep those blinkers on – don’t let your eyes stray to products that aren’t on your list.

Job done! You’ve saved time and money, and cut down on waste at home.

13. Use Discount Codes, Coupons, & Loyalty Cards

Blue Light Card

Whether shopping in store or online, use discount codes and coupons, and sign up to those retailer loyalty cards. But don’t wander off your list just because a discount code makes an item irresistible to you – this is exactly what retailers want you to do.

To make this tip work for you, sign up for loyalty cards at all the stores you use regularly (like Nectar or Tesco Clubcard), and take a few minutes before you go shopping (or shop online) to search for codes and coupons online.

The Blue Light Card is a great scheme for civil servants, and I’ve found a good few discount sites for teachers and others in the educational system, too.

Put this tactic into action, and you could significantly reduce your shopping bills without compromising on quality.

14. Consider The Total Cost Of Ownership

Here’s a trick to keep up your sleeve, especially for bigger ticket purchases: consider the total cost of ownership, not just the price tag.

Electrical goods use electricity. Other items may need regular servicing or maintenance. You might need additional accessories. Some purchases will need to be insured.

All these costs mount up, and can be a continual drain on your cash.

Before committing to a purchase, take a few moments to consider the ongoing costs. Are you really getting value for money? Or are you buying a money pit? Running these checks will mean you’ll make better buying decisions, and ensure you only purchase items you really need.

An example? I was considering buying a new car a long time ago – part-exchanging my existing car at the time. Before I put pen to paper, I figured out what the car would be costing me (I’d need a car loan, insurance, tax, MOT, maintenance, and so on).

I then calculated my cost per mile of use. It worked out that it would be cheaper for me to take taxis and hire a car for holidays than buying a new car, even though I’d been offered an incredible sale price.

15. Set A Per-Use Spending Limit

A twist on the total cost of ownership model, this tactic gets you to think about how much an item will cost for each time you use it. This forces you to think about whether you really need the item you’re considering purchasing.

It’s easy to put this into action. For example, let’s say you’re thinking about buying a coat for £100. If you’re likely to wear it every day for the next three months, then it will cost you around £1 per use.

If you only expect to use it once a week, the cost per use rises to around £9. Now you need to ask yourself, does this seem a reasonable amount to pay per use – or would the £50 coat on the next rail be a better investment?

16. Save Energy & Reduce Utility Costs

Energy prices have gone through the roof over the last two or three years, and now constitute a larger portion of household expenditure than they ever have. If you haven’t done so already, making a few small adjustments around the home, and adopting some simple energy-efficient habits can make a significant difference to your bills.

Start by looking at your home to see where you could make energy efficiencies. For example, switching to LED bulbs could reduce energy usage and they last much longer than standard bulbs. Sealing leaks around doors and windows is another energy saver.

Turning down thermostats a couple of degrees, switching off lights when you leave a room, unplugging appliances rather than leaving them on standby – all of these actions save energy and reduce bills.

17. Switch To A Cheaper Energy Provider

High energy bills don’t have to be a strain on your wallet. As well as implementing energy saving measures, regularly compare your energy provider with others. You can use comparison sites, research directly, or use auto-switching services like Switchd, Switchcraft, and Homebox.

These monitor energy prices across the market, compare costs with your energy use, and ensure you are always with the cheapest energy providers.

18. Plan Free Activities To Enjoy Life More

Keeping yourself and your children entertained is an expensive activity these days, but it doesn’t have to be. There are opportunities for free or low-cost memory makers everywhere – and that’s what it’s all about, isn’t it – making memories?

Start by taking walks in parks, visiting free-admission museums, and enjoying community events. Take the kids for a picnic. Have friends over for dinner instead of visiting a restaurant.

Have a games night or movie night. Annual passes to zoos and other attractions save a huge amount of money.

When you want to treat yourselves, look for cheap deals (like two-for-one meals at your favourite restaurants) or browse sites like Groupon and Wowcher for amazing deals across a range of activities from cheap spa days to mini-city breaks.

19. Consolidate Debts

If debt is getting on top of you, and there’s no easy way to get it paid off quickly, the best option might be a debt consolidation loan. By combining all your debts into one, you’ll make your debt easier to manage and cut the interest rate.

This could reduce your monthly payment and save you money on interest over the term of the loan.

List all your current debts, including what you pay, and the interest rates charged. Search for a consolidation loan with a lower rate of interest – banks, building societies, and credit unions are good places to start.

Pay off all your existing debts with the loan, and benefit from a lower rate of interest.

(Tip: Don’t borrow more than you already owe – and overpay on monthly repayments whenever possible to reduce your debt faster.)

20. Enlist aAn ‘Accountability Buddy’

An accountability buddy is a powerful tool to help you keep on track. Share your spending goals with someone you trust to support you – a friend, spouse, or other family member.

Discuss the tactics you plan to use, and how they could help you stick with them. Set up regular check-ins with your accountability buddy to chat about your successes and challenges.

When deciding on who your accountability buddy should be, look for someone who has similar financial goals to you, and who may also be struggling with keeping their spending under control. You can then support each other.

For example, if you’re both aiming to reduce how much you spend on eating out, you could challenge each other to a week of homemade meals.

An accountability buddy will call you out when you slip up, but also encourage you to get back on track and stay in the right lane – it’s the honest conversations that are most difficult to have when you’re going it alone.

Retail Therapy Doesn’t Help

When you’re looking to reduce your spending, indulging in retail therapy to boost your mood when you’ve fallen off the wagon is like diving into a tub of ice cream when you’ve strayed from a diet and put on a couple of pounds. Any high you achieve is soon tempered by the realisation that you’re derailing your long-term goals.

The result is that you buy something when you’re feeling down to make yourself feel better about overspending, only to feel worse.

Instead of scoffing that ice cream, go for a walk! What activity can you do to make you feel better, rather than a bit of retail therapy that will result in you feeling worse and being worse off?

Make Small Changes To Start

Putting all these spending reduction tactics into practice simultaneously is almost impossible. You can’t climb Everest in a day!

Instead, start small. Choose a few strategies that you feel you can implement quickly, or that are most important to you. It might be something as small as unsubscribing from marketing emails or cancelling unused subscriptions.

Small wins can quickly add up. As you see the fruits of your labour accumulating, it will spur you on to do more.

As you integrate each tactic into your daily life, poor financial habits will be replaced by good decision making that will leave you more confident and better equipped to tackle tougher financial challenges.

It’s about creating sustainable routines that deliver significant gains.

Reduce Your Spending & Reward Yourself

It’s often difficult to see the difference that your efforts are making, and you can be fooled into thinking you haven’t made any progress. For example, the £10 you save each month on your electric isn’t tangible – you can’t see it or feel it.

Here’s how to make sure you realise just how well you’re doing: put your savings into a separate account. Take what you were spending before you started on this journey and deduct what you are spending now – then put the difference into a savings account.

That electricity bill used to be £100, but is now only £90. £10 into savings. You used to spend £100 a month on clothes, but that’s now only £50. £50 into the savings account. You get the picture.

You’ll soon see your savings mount up. Now for the fun part. Give yourself a pat on the back for doing so well. When I say a pat on the back, I mean a little treat; like a meal out, a weekend getaway, or buy that gadget you’ve had your eye on.

In short, reduce your spending, improve your finances, and reward yourself.

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