The financial bad habits you should give up for Lent... and then for good

Embargoed to 0001 Thursday December 12File photo dated 18/03/13 of money as the UK downturn is finally expected to be left behind next year as the size of the economy surpasses its pre-recession peak, according to a new forecast upgrading prospects for growth. PRESS ASSOCIATION Photo. Issue date: Thursday December 12, 2013. The prediction from the British Chambers of Commerce (BCC) brings forward the likely date to the third quarter of 2014. It would mark the first time that UK gross domestic product (GDP) has climbed back to the peak it reached in the first quarter of 2008. See PA story ECONOMY GDP. Photo credit should read: Lynne Cameron/PA Wire

%VIRTUAL-SkimlinksPromo%Why not use Lent as a time to sort out your finances?

Today is the first day of Lent. It marks the 40 days and nights that Christians believe Jesus fasted in the desert. Many attempt to follow his lead by ditching something for this period, whether it's alcohol, crisps or something more substantial.
Indeed, research by Axa estimates that giving up smoking (£220.80), drinking alcohol (£78.12), chocolate (£20.11) and coffee (£56.99) during Lent will mean a cash boost of £376.02.

But whether you're religious or not, it's a good time of the year to take stock of your life and weed out any bad habits.

When it comes to finances many people are guilty of making bad mistakes which are costing them money. So why not use this period to look over your financial habits. Are you guilty of any of the below?

1. Only using one supermarket

Competition is fierce between the major supermarkets and they are always looking for new customers. Fail to shop around and you can end up out of pocket.

For example, a loaf of bread from the basic range is 55p at Aldi, 79p at Morrisons, 85p at Asda, and 90p at Sainsbury's, Tesco and Waitrose. Therefore before you head out check a website such as MySupermarket to make sure you're getting the best price on your weekly shop. If you can, consider shopping around to maximise your savings

2. Staying loyal

Companies rely on customers staying loyal in order to milk them for all they are worth. By sticking with one company, be it for your utility, phone or broadband bills, you're likely missing out on the best deals.

It's a boring task but switching energy companies alone can save a household up to £300 which is well worth the cost of some time spent researching the market.

3. Buying your lunch

It's an obvious one but it can also make a real difference. Buying your lunch out can quickly add up to an extra £5 a day and if you add on coffee and afternoon snacks this could be nearer £10.

Giving this up and making your lunch before you head out the door can therefore save you up to £300 a month.

4. Not complaining

When you're in a restaurant it's normal to complain if something's not right, but many people don't follow the same rules in other walks of life. Banks, for example,are often guilty of making mistakes, yet many of us do nothing about it.

If your bank makes a mistake with your account make sure you complain directly.

If it's unable to help, or doesn't give a satisfactory response, take your complaint higher and head to the Financial Ombudsman Service.

5. Paying too much for travel

Buying a ticket on the day you travel will always be more expensive as travel companies take advantage of people unable to book beforehand.

If you know when you're travelling, book as far in advance as possible. A one-way ticket from London to Glasgow for example, will set you back £129.60 on the day but book it two months in advance and the price falls to as low as £29.50.

6. Paying full price for socialising

When you're trying to save money it's hard to justify going for dinner or to the cinema. But with a little research first, you can still do these things and cut down your spending.

Voucher codes and coupons are available at a huge range of restaurants, as we highlight in our Frugal Food blogs. There are also often deals on going to the cinema or the theatre. We pick out the best in our Frugal Friday blog.

7. Not being paid to shop

When you buy stuff online it's possible to get paid a percentage of the cost of each item by going through a cashback site. These websites work by passing the fee they receive from the retailer onto the customer.

The two leading websites are Quidco and TopCashback. Why not give them a try?

Use a cashback credit card, making sure you pay off the balance in full each month, and you can make even more money.

Compare cashback credit cards

8. Hoarding unwanted stuff

Unwanted clothes, books or DVDs which you know you'll never use again can be a good source of extra income. Online websites such as eBay can be an easy way to sell your unwanted stuff but check the fees first as they can vary quite a bit.

A car boot sale is another way to get rid of your clutter but don't expect to make hundreds. It's better to save valuable items, such as a mobile phone, and sell these through specialised companies.

9. Settling for a poor interest rate

Interest rates are pretty poor right now. But instead of settling for a rock-bottom rate, you should look elsewhere.

Peer-to-peer websites, for example, provide much higher returns by cutting out the middle man.

Credit unions are another avenue and generally provide better interest rates than the high-street banks. Some current accounts are also paying interest rates way above those on savings accounts.

Could you earn more interest on your money by lending it out?

10. Burying you head in the sand

When debts build up it's easy to ignore them and carry on spending, but there is help on hand.

Addressing the problem and working out how much you owe is the first step to becoming clear of debt.

If you're repaying expensive debts, a 0% balance transfer credit card may be an option. These give you a break from hefty repayments but they only work if you actually repay the debt in the time-frame given.

But sometimes your debts are too big to be fixed simply by switching your credit card. So make sure you get some free debt help from a debt charity, such as Step Change or Citizens Advice. Read Where to get free debt advice for more on who to contact.

12 ways to save £10,000 in 2014
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The financial bad habits you should give up for Lent... and then for good
Mortgage rates are low at the moment, but even if you feel that your mortgage is a pretty good deal already, for a lot of borrowers there are better rates to be had. It's crucial to get the sums right – high upfront admin costs from a new lender or large early repayment fees from your existing mortgage provider could wipe out any savings. But, says David Hollingworth of brokers London & Country: "If you have an average standard variable rate (SVR) of 4.75%, a borrower with a £150,000 repayment mortgage over 20 years would pay £969.34 each month. Switching to a two-year fix with Norwich & Peterborough BS at 1.99% with £295 fee, free valuation and free legal work for remortgage would cut the payment to £758.11 a month, saving £211.23p.m." Over a year, that would mean a saving of £2,240, even with a £295 up front fee, and £2535 in following years.
Potential saving: £2,535
Your home and contents insurance may be costing more than it needs to. Gocompare.comdata shows that 25% of customers who provided their buildings and contents insurance renewal price saved up to almost £160 by changing to a new provider.
Potential saving: £160
With today's high cost of fuel, running a car is an expensive business. For a lot of people, particularly where public transport is sparse, giving up a car altogether is too big a challenge. But perhaps you could use it less, and take steps to bring down the cost of driving when it's unavoidable. The Energy Saving Trust says that just keeping your tyres pumped up correctly can save £31 a year, and turning off the air conditioning can save £77. Follow all the advice on the Energy Saving Trust's app, such as lift sharing and keeping your speed down, and the organisation claims you could save as much as £554 a year for a medium car covering medium mileage.
Potential saving: £554
If you haven't changed car insurer recently, the chances are you could save a lot of money by doing so now. According to research from Consumer Intelligence for, in October 2013, 51% of consumers could save up to £242.55 by moving to a new insurance provider. There are plenty of comparison sites to try, including AOL Compare, so it really doesn't take long to find a cheaper deal.
Potential saving: £243
Start by finding out whether you could get a cheaper deal from a different energy supplier. If you haven't changed in the past, you probably can. According to, you could save around £309 a year just by switching to a cheaper deal (based on customers who switched energy supplier for both gas and electricity (dual fuel) using the Energylinx platforms between 1 July and 30 September 2013).

Over the long term, there are plenty of ways to bring down bills that involve a relatively large outlay up front, such as ensuring your home is properly insulated. But just cutting your current energy use can have a huge impact on your energy bills. Some of the steps you can take are just a question of habit changing, such as switching appliances off instead of leaving them on standby. The Energy Saving Trust reckons the average household could save £50 and £90 a year just by unplugging or switching off at the socket. And turning down the washing machine temperature to 30 degrees, using a washing up bowl instead of leaving the tap running and only putting as much water in the kettle as you need can save you as much as £55 a year. Draught-proofing will save another £55, and proper 270mm loft insulation could save you up to £180 a year – taking into account the cost of fitting it the savings will take a couple of years to kick in.
Potential saving: £689 (far more if you take all the right steps in the home)
According to the NHS, most people who quit smoking save almost £2,000 a year. On top of that you get to feel healthier. What's not to love?
Potential saving: £2,000
Or at least, make your own. If you work in a town or city, the temptation to pop in and get a coffee can be strong. There's something comforting about sipping a hot coffee from those nice warm paper cups as you gear up for the working day. But if you stop to add up what it costs (including the cup), it may leave you cold. A Starbucks medium (OK, tall) latte costs £2.60 on the Strand in London. If you have one of those five days a week, 46 weeks a year (allowing for four weeks holiday), that means you are spending close to £600 – a tall price for a caffeine fix. If you make your own, a Bodum coffee maker costs £20 and a kilo of coffee costs around £13 and will make roughly 120 – 140. Missing the cup for the walk to work? Buy a Thermos mug for around £10. For £43, plus the price of milk, you can have coffee on the go all year round.
Potential saving: £557
It's a familiar scenario for many well-intentioned would-be gym bunnies. You sign up super motivated. You buy new workout gear, perhaps you work out regularly at the start. But then something – a holiday, a nasty cold, late nights at work – breaks your momentum and you stop going to the gym. Eventually your workout clothes lounge around in the cupboard while the gym keeps your bank balance trim by taking that direct debit each month. Gym memberships vary, but if you pay £80 a month for full membership, that's £960 a year's worth of good intentions. Invest in some proper running shoes – you can spend a fortune but specialist shop Run and Become has decent shoes for £50 – and hit the road. Need motivation? Download a free app such as Couch to 5k to get you started and track your progress as you get fitter.
Potential saving: £910
The range of mobile tariffs can be baffling. Many people end up on the wrong deal, perhaps paying for call time or extras they don't really need or use. There are a number of online tools and apps you can use to check your bill is not too high, such as Billmonitor and Mobilife. Enter your existing details and see if you could save money. In 2012, Billmonitor reckoned 26 million consumers in Britain were paying over the odds by as much as £164. The savings you could make will vary hugely, but it's certainly worth taking a look to see what you could save.

Apps like Viber and Whats App are also worth a mention as they allow you to text and call (Viber only) other users for free who have the apps on their smartphones. Whats App has ayearly subscription fee of around 65p, but the only other cost is the data on your smartphone plan if you're using 3G.

And when it comes to your broadband and home phone, it pays to find out if you are on the best deal. Dominic Baliszewski, telecoms expert at says: "Our own analysis has highlighted time and time again that a high proportion of customers do not actually switch broadband regularly enough to benefit from better pricing, which is crazy when you consider that switching can save you over £200 from your annual bill. Switching levels for broadband are woefully low when compared with energy or insurance services."
Potential saving: £364
In the UK, households throw away an estimated 25 meals each month, worth a total of £60 a month or £720 each year. Avoid buying too much food, even when it seems like you are saving money. Try not to 'take advantage' of bulk buy deals you may not use, make good use of your freezer for fresh foods rather than putting them in the fridge and forgetting them, and change a few of your shopping and eating habits and you may save money.

Make a list and stick to it. Shopping online can help you avoid temptation, and if you do your shopping on, you could save even more. Enter your items as you would on a supermarket site, and it will find the cheapest supermarket for your needs saving on average £17 a shop, according to the site. On a weekly basis that makes £884.

Growing your own vegetables can also save money, although the set up costs can be relatively high if you are starting from scratch. But some foods are cheap and easy to grow, even if you have little space. If you are in the habit of buying bagged salad, you could easily save a significant sum by growing your own. Jane Perrone, gardening editor of the Guardian and author of The Allotment Keeper's Handbook, says: "The materials to grow your own probably cost something shy of £20 a year, for seeds and compost mainly - I usually use recycled containers." A standard bag of salad from a supermarket costs around £1, so if you would usually buy one bag a week, you would spend around £52 a year.
Potential saving: £1,636
A Sky Sports bundle costs £43.50 a month, that's £522 a year. It's enough to take you somewhere sunny on holiday. It's enough to buy a whole new wardrobe full of clothes. Or, more importantly, several weekly food shops. Whatever else you could do with that money, it's certainly enough to make you think twice about whether or not you want to keep paying those subscription fees.
Potential saving: £522
You might not be able to pay your credit card off straight away, but you can cut the cost. If your credit card has a rate of 18.9% and you have a balance of £5,000, then you could save £472 by doing a balance transfer to a credit card with a 0% introductory deal for the first six months.
Potential saving: £472
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