WHEN it comes to parting with our cash, we all have our own peculiar habits. But some of the things we’re doing – or not doing – could be making us significantly worse off.
The amount of money being thrown down the drain can become particularly large if the same mistakes keep being repeated, week after week.
You might think you are saving money, but the reality is actually very different.
Here are some of the most common money mistakes, and how to avoid them...
Wasteful bulk-buying
Piling goods into your trolley in bulk can be a great way to save cash over the longer term – but there are also pitfalls to this money-saving tactic.
More than three-quarters (76%) of shoppers are regular bulk-buyers, with toilet paper, baked beans and soap among the popular items to stock up on, TopCashback.co.uk has found.
But while 86% of bulk-buyers say they stock up in a bid to save cash, nearly one in five (19%) admit they don’t end up using all the items they bought in bulk – perhaps because they went out of date, or didn’t have enough room to store them.
Needless spending
More than a quarter (26%) of people say they bulk-buy without checking supply levels at home. This can increase the chances of being wooed by special offers you don’t really need.
Nearly a third (31%) admit to buying items they only think they will need because they are on offer, and 3% buy items they do not need at all.
Opting for a higher excess
When choosing a car insurance deal, some people may decide to go for a higher excess – the amount you will pay towards any claims you make on your policy – in order to get a cheaper insurance deal, but is this worth it? Comparison website uSwitch.com found the average quote for drivers opting for a £1000 voluntary excess is £318 a year – just £12 cheaper than a policy with a £250 voluntary excess.
This means someone could end up taking on up to £750 of additional liability for a saving of just £1 a month.
Falling for social media trends
Nearly a quarter of social media users have made a purchase as a direct result of something they spotted on somebody’s feed, spending an average of £318 per year, Post Office Money found. But two-thirds ended up regretting what they bought, with 37% wishing they’d put the money towards reaching a savings goal instead.
Neglecting to shop around
Research from Citizens Advice found loyal customers often get charged more than new ones for energy, mobile, broadband and home insurance accounts.
Analysis suggests customers who stay loyal to their essential service providers could be paying £987 more per year – equivalent to four months’ worth of food for the average household.
Sticking to your old bank accounts
If you’re looking for somewhere to put your savings cash, competition this year has been particularly strong so far among “challenger” banks, according to website Moneyfacts.co.uk.
While some of the newer banks may not be that familiar, you may find you can get a better savings rate.
Rachel Springall, a finance expert at Moneyfacts.co.uk, says brands such as ICICI Bank, Paragon Bank, Ford Money and Tesco Bank are among those which are offering competitive savings deals.
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