I’m a budgeting expert – ten ways to make your money go further in 2023

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WITH the New Year just round the corner, now’s the perfect time to start thinking about how to make your money go further in 2023. 

Here Sarah Pennells, consumer finance specialist at Royal London, runs through some of the best ways to get your finances in good order. 


Budgeting expert Sarah Pennells shares her tips for 2023

After all, anything you can do now to ease the inevitable impact of the cost of living crisis is well-worth considering

Be a financial detective 

If you want to get a grip on your finances it’s essential to figure out where all your money goes each month. 

Sarah says: “Start by finding out where your money goes. Grab your last three bank statements, and credit card bills if you have a credit card. Look at everything you’ve spent, and I mean, everything! 

“Ask yourself: do I need it? Can I afford it? Can I get it cheaper?”

Be ruthless

It goes without saying that you probably don’t need everything you currently spend on.

Something you really can’t cut back on, such as essential groceries, but what about luxuries, such as subscriptions?

“Phone contracts, video streaming, like Netflix or Amazon, and magazine subscriptions are a waste of money if you don’t use them,” says Sarah. 

“Check that you can cancel without breaking the contract. If you’re still locked into a contract, set a reminder for when you can cancel.” 

Keep a diary

With so much spending being done online, on plastic as well as in cash it’s easy to lose track of where all those pounds and pence go. For this reason, Sarah recommends keeping a log of all transactions. 

She says: “Your bank statements or banking app will show what you’re spending every day.

“But a spending diary, where you write down how much you’ve spent and what you spent it on, can be a great way of showing you where money is slipping through your fingers.” 

Don’t miss out on free cash

Billions of pounds in benefits go unclaimed each year and it could make a big difference to your budget. 

Thousands of people miss out on Pension credit – a means-tested benefit for people over State Pension age, and some working-age benefits also go unclaimed. 

Sarah said: “You can use a free benefits calculator at Turn2us.org.uk to see if there are benefits you can claim.” 

Make the most of your tax allowances

There are several different tax allowances that you might be entitled to claim, yet don’t. Take the marriage allowance, which is a tax perk worth up to £252 this year. 

“You can claim it if you’re married or in a civil partnership and one of you is a basic rate taxpayer and the other doesn’t pay tax,” says Sarah. 

“But you can go back up to four years, so you could claim around £1,000 in all.” 

Don’t miss out on the State Pension

Sarah points out that if you have gaps in your National Insurance record and you’re not in line to get the full State Pension, you can go back and plug those gaps by buying voluntary National Insurance contributions. 

Until April 5th next year you can go back until 2006 whereas after that you’ll only be able to go back six years. 

You must have been born after April 5th 1951 if you’re a man, or 1953, if you’re a woman, to make use of this extra time. 

Start to save

Times are tough, but they could be a lot tougher if something went wrong and you found yourself having to cover a large, unwelcome payment. 

Sarah said: “Royal London cost-of-living research shows that a third of people could only afford an unexpected bill of up to £500. 

“But if you have some savings, it means you don’t have to borrow, possibly at high interest rates, if you have a bill out of the blue.” 

Even if it’s just £5 a month, you could put it towards next Christmas and ease the financial burden slightly.

Make what you spend go as far as possible

This tip is all about being a savvy shopper. Think again before reaching for the old favourites, especially if there’s a cheaper alternative on the supermarket shelves. 

“If you ‘buy branded’ when you’re in the supermarket, do a taste test and see if you notice the difference between your favourite brand and the supermarket own-brand,” says Sarah. 

“You could pocket some real savings. For example, own brand tomato ketchup was a quarter of the price of branded ketchup when I checked recently. 

“And if you’re on benefits such as universal credit, for example, ask your broadband provider if you qualify for a social tariff. It could save you some money.”

See if you can pay less interest

If you owe money on an expensive credit card, you may be able to save by transferring your balance to a 0% credit card. The cards may be interest free, but there’s normally a fee of up to 3% to pay.

Sarah said: “Make sure you pay off your balance by the time the 0% interest deal runs out. It may also affect your credit score, especially if you do it multiple times, so these cards aren’t right for everyone.”

Get help if you’re struggling

Sarah’s final tip to help get your finances in better shape during 2023 is to not suffer in silence. She points out that Royal London research shows only a quarter of people had asked for help, despite many worrying about rising bills and costs. 

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“Get in touch with your energy company, landlord or mortgage lender, broadband provider and other service providers if you can’t afford your bills,” Sarah said. 

“If they can’t help, contact Citizens Advice. Debt advice charities such as StepChange can help if you’re struggling with debts.”

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