Get a handle on subscription services and monthly payments
If you’re an older Gen Zer, you may have vague memories from about a decade ago when subscriptions weren’t the normal, done thing. Back then the typical consumer maybe had an account with Spotify or Netflix at most.
Today it’s an entirely different story, with every company under the sun launching its own monthly service to try and get a slice of the pie. Having all of these options is great, but it has become incredibly easy to rack up monthly payments without even realising how much you’re spending.
Say you have a Disney Plus, Amazon Prime, Netflix, Spotify, and PlayStation Plus subscription. That’s totalling upwards of £50 a month before even considering a phone contract, which usually cost around £30 – £40, or novelty items like Dollar Shave Club or Adobe Creative Cloud. Regular bills for these services can quickly wind up being over £100 – which is probably a bit too expensive for the average person.
Take the time to check through bank statements and ensure there aren’t any forgotten subscriptions from yesteryear floating about. One I’d particularly recommend looking out for is old phone insurance coverage schemes, as most don’t automatically cancel with a phone contract and will need to be done separately.
Use challenger banks like Monzo to better understand where money goes
We’ve written about the rise of challenger banks with Gen Zers before, and they’re particularly useful if you’re keen to know where regular income is actually going. Banks like Monzo or Revolut are digital-only, but they allow for quick transactions and simple, no-nonsense budgeting.
They’re a good option for those who are eager to reduce how much they spend and alter their day-to-day behaviours. Challenger banks allow users to see what’s most expensive – like groceries, eating out, or bills, for example – and in some cases can even suggest ways to save money based on personal data. Money can be moved around easily too and bank apps will show a detailed history of every place and time a card was used within the last year or so.
It’s worth mentioning here that we’re not affiliated with or sponsored by any challenger banks, just in case you were wondering.
Keep an eye out for reduced, vintage, or second hand items
I realise many of us are now confined to our homes once again, but reduced or re-used items are a great way to save money on everyday products, especially at local supermarkets.
Check clearance shelves, look for pre-owned items, and keep an eye on membership schemes. Admittedly Gen Z are less likely than others to tap into loyalty reward cards but they can help to save if you pick one up for somewhere you visit regularly. Sometimes shops will even have food bins that offer items for free – so be sure to keep tabs on places that dish out the cheapest items.
Resales and peer-to-peer marketplaces are also excellent sources of affordable and unique products. Young consumers are already redefining what we associate to be ‘vintage’ with apps like Depop, so chances are you probably already know all about independent art and clothing sites. If not, I’d recommend looking at Etsy as a starting point for unique alternatives to more expensive mainstream brands.
Give yourself a monthly ‘extra spends’ budget
It might seem a bit arbitrary to suggest this one, but consciously budgeting extra outgoings each month can make a huge difference in the amount of money saved. Dedicating a small sum to going out, takeaways, or items like clothes and video games can help to keep the cash splashing to a minimum.
Emotional spending to alleviate feelings of anxiety or depression is a very real thing. In fact, as the mental health charity Mind explains, financial security and money spending are both intrinsically tied our general wellbeing. We tend to buy new, exciting items as a way to feel a brief ‘high’, and this can have damaging repercussions on our long-term finances.
This is particularly poignant as lockdowns return and online spending sores. We’re at home nearly all the time – which means a greater impulse to buy what we don’t need. Actively recognising why you’re buying something and limiting the amount you do spend on extra items or services will help to keep things under control.
Establish flexible long-term goals to keep motivated
Speaking of budgeting, it’s a good idea to have some notion of long-term finance goals, however ambiguous they may be. Consider how long you want to save for and why.
Is it to eventually buy a mortgage and get onto the property ladder, or is it to go travelling when COVID-19 finally pipes down? Having a motivation and purpose for saving will help to stick to a plan in the long run. It’s worth writing down how much cash you want to have in the bank in five, ten, or even twenty years.
Remember that time frames and situations change, so allow wiggle room and accept that it may not be possible to rigidly stick to anything over time. Simply having that mental framework is a great start. It doesn’t need to be a huge life plan, either – it could simply be to save up for a big purchase like a PlayStation 5. Which sounds dope, quite frankly.
For more money guidance visit the Citizen Advice website here, or visit the Money Advice Service hotline page here.