When money’s tight and we’re looking at ways to budget, we start to cut big expenses from our monthly spend. Cancelling gym memberships and phone bills, walking instead of driving, making weekly meal plans; they’ll all help save money in the long run.

But actually, a big strain on our everyday finances is the stuff we don’t think about or even realise we’re paying for. A gym membership might cost £20, but that’s nothing compared to spending a few quid on a daily basis.

So in this blog, we thought we’d take a look at six expenses that you shouldn’t be paying. Cutting these out could go a long way to creating more disposable cash at the end of the month.

Withdrawing cash

‘This cash machine charges £1.75 per transaction. Are you happy to continue?’

Answer this question honestly: have you ever paid to withdraw money because you didn't want to walk to the nearest free cash machine? If the answer is yes, you have thrown money away. In today’s world of contactless shopping, the urgent need to withdraw money is dwindling. Pay for your goods via your card and save that £1.75 for something you need.

Or if you can’t pay on card and you don’t live anywhere near a free cash machine, make sure you withdraw money in large quantities. £1.75 as a percentage of £10 is a lot. £1.75 as a percentage of £100 isn’t so much.

Having a bank account

If you think it’s free to have a bank account, think again.

Some bank accounts offer perks for choosing them, but they often come with a fee. Take the club Lloyds account for example. They offer 2% AER variable credit interest on balances £1 to £5000 plus other benefits.

They also charge £3 per month if your deposit less than £1500.

For some accounts, the small fee is worth it for the great benefits. But make sure that you’re making the most of those benefits, or find a bank account that doesn’t charge.

Tips

Paying a tip at the end of a meal or taxi ride has long been a contentious issue. Some people will give 10% no matter what, others hand over whatever loose coins they have in their pocket. But there are lots of people who downright refuse to pay.

This used to be an issue of whether you wanted to be seen as being ‘tight’. But now, prices are rising and many restaurants include service charge as part of the bill. Not paying a tip is becoming more and more acceptable.

So we would invite you to consider two things before paying a tip: 1. have the waiting staff gone above and beyond their call of duty (because after all, they get paid a wage to bring your food to the table and take away dirty plates) and 2. Is service charge already included in the bill?

Tips may not seem like a big expense, but if you take the family out for a meal twice a month and pay a 10% tip each time, it could be costing you between £10 and £20.

Late fees

Late fees are a real point of frustration for many. Cash flow doesn’t always fit in with company billing periods. Just because you can’t pay on time, doesn’t mean you won’t be able to pay in full the day after.

Being charged for a day's grace- and some of those charges can be in excess of £10 depending on the bill- can cause a real hit to your budgeting. So why do companies charge late fees?

For the most part, companies charge these fees to ensure that people don’t take advantage. They’re to deter people from not paying in an attempt to avoid the charge.

They’re not there to punish honest payers. So if you do have a problem meeting the payment deadline, give the company a call and let them know. Most of the time, they will try to help you. After all, if you can’t pay because their fines have put you into financial difficulty, they’re missing out as well.

Interest on credit cards

You may have heard Martin Lewis from Money Saving Expert talking about this a lot. If you have credit cards with large charges, you should explore the opportunity to transfer the money to an interest free credit card. Interest free cards allow you to pay off your balance much quicker (as long as you pay the minimum monthly amount.

For instance, if you have £750 balance on a 5% interest card and you pay £75 per month, it will take you 14 months to pay it all off. And that’s provided you don’t spend on it in that period.

With an interest free credit card, that balance would be paid in full within 10 months. That’s a saving of nearly £300.

Get a hold of your finances

The trick to making the most of your money is keeping track of what you’re spending. There are so many fees and costs that are avoidable, if you make the effort to change your habits.

 

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