Looking to save money in 2023? This is something that most will be looking to do with the cost-of-living crisis putting great strain on people’s finances. It is hoped that inflation will ease later in the new year, but it could still be a challenging year for many. Here are a few ideas for ways that you could save money in the new year.
The Impact of Inflation & High-Interest Rates
First, it is helpful to look at the current situation. The cost-of-living crisis has developed as a result of record inflation outstripping wage increases, which has resulted in people have less money to spend. On top of inflation, consumers are also battling the energy crisis, fuel crisis and rising interest rates, which is seeing many struggling to maintain their standard of living and many are having to make difficult decisions. Although it is hoped that inflation will come down in the new year, it is thought that inflation will remain high for the next two years and that the target of 2% will not be reached until the second half of 2024.
So, what can people do to save money in 2023? Here are a few ideas that should help.
Reducing Car & Household Costs
For many people, a huge amount of their monthly income goes toward car and household costs so these are important areas to address. To keep car costs down, you should only drive when necessary, perform your own basic maintenance and shop around for cheaper insurance when your current policy ends (there are also ways to make your insurance cheaper). You can also switch to a basic car service instead of a full service to keep your maintenance costs down.
In terms of household costs, food shopping is a key area. It is worth shopping at a cheaper market, buying supermarket-own products and buy in bulk to keep costs down. You can also save money by batch-cooking meals from scratch and cutting back on luxuries and takeaways.
Reduce Debts
If you have debt, this is also an important area to address with interest rates so high. If possible, you should try to reduce debt as much as possible so that you do not have to pay high-interest rates. Instead of taking on new debt, you should use an emergency fund or avoid making large purchases on credit if possible.
It is a tough time right now with the cost-of-living crisis and this will continue to be a challenge throughout 2023. Therefore, people should be looking to make smart financial decisions in the new year and the above are a few of the best ways that you can go about doing this. Hopefully, this will help you to offset the cost-of-living crisis and perhaps even improve your financial well-being in 2023.
Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.
