Don't be penny wise but pound stupid
When beginning a new money-saving regime it's easy to get so wrapped-up in your new found frugality that you lose sight of the bigger picture. This can mean making smaller gains overall, or being penny wise but pound stupid! A typical example is spending hours hunting down the cheapest items in the supermarket or travelling further to a garage that sells slightly cheaper petrol. Tactics like these will certainly save you money, but you should also take into account the amount of time these activities use up. Is saving a few pounds here or there really worth you losing so much of your free time?
The bigger picture
The fact is that looking after the pennies is a sensible day-to-day strategy to avoid frittering away your hard earned cash. Impulse buys can make a dent in your pocket and be a waste of money. What will really make a big difference to your pocket however is how you approach bigger financial commitments. If you have a large and uncompetitive mortgage, an expensive credit card debt or a poorly paying savings account, no amount of food saving vouchers will compensate for poor financial planning.
Overhaul your finances
The first thing to do is to review your financial situation. There are a number of useful websites available online with unbiased information and templates which you can use to analyse your finances. Go through all your statements and bills to see just how much you are spending on a monthly basis.
Making sure you get the best deal on all your financial products can make a big difference to your monthly income and outgoings. For example, shaving a percentage point from your mortgage may save you a valuable sum of money each month that can be invested elsewhere. Switching credit card bills to a zero rate card will save you a great deal on interest payments and help you pay off your debts more quickly. Searching for better prices on your insurance policies and cancelling unused direct debits will also have a similar effect.
Use an online switching service to hunt down the best deals, or contact an Independent Financial Advisor who can recommend the best products from all of the market. If you are in debt and need help, you could try getting in touch with a debt advisory service through your local Citizens Advice Bureau.
Once that's in place...
Once you are clear about your financial goals and know what you are aiming for, you can start to look at the everyday spending. This is where you will start making weekly shopping budgets, being clear about where you can save money and using tips and techniques to shave off unnecessary spending. Be clear about what really makes life worth living for you though - a few judicious luxuries are welcome here and there! Focusing on quality not quantity can be a good strategy to help you spend wisely and manage your finances for the long term.