Understand your true disposable income

Disposable income is your total household income minus your living costs (like rent, mortgage, energy and food). What’s left you can spend on whatever you choose (like going out, or holidays) or you could save some of it. 

When we get paid many of us feel a bit flush with money, it’s why companies know to fill our inboxes with all those tempting payday treat emails on just the right day… However not many of us realise how much money we really have left after paying the bills that MUST be paid. 

Try to calculate your true disposable income and it will surprise you how you have much less you have left than you thought each month. 

Here’s the tough bit – you need to save some it to be better off in future, rather than spend it all like many of us do every month. Saving a little every month all adds up to making progress on saving for a deposit, or putting some money aside to invest or put into a pension to provide a future income.

First a sobering statistic – disposable income for younger generations in the UK is forecast to decline by 3% every year until 2028. 

So you need to find ways to increase your disposable income. Your can do this by  either increasing your income or reducing your expenses or a combination of both of them. 

Ask for a Pay Rise or Move job –  If you’ve been in your job for a while and contribute significantly, try to negotiate a salary increase. If that doesn’t work look to move job to a better paid one or to a sector that pays more. 

Start a Side Hustle – Consider how you can top up your income with a side hustles and we have lots of ideas for you here at OnestopSave. 

Work Overtime or Get a Second Job – If possible, work extra hours or take on a part-time role at the weekend to boost your income. 

Invest in Skills & Education – Higher qualifications or certifications can lead to better-paying jobs for you and open up new opportunities as you’re adding value to yourself (and it might make you feel better as we all like learning new skills).

Cancel Unnecessary Subscriptions – Stop any unused subscriptions like gym memberships or streaming services you aren’t regularly using and explore cheaper options. 

Reduce Utility Bills – Compare providers here at OnestopSave for insurance and energy to find a better deal. If you do, remember you only save if you switch. 

Reduce Food Costs – Try shopping a low cost discounters like Aldi, use supermarket loyalty schemes or buy more own label brands and try cooking at home instead of eating out or having takeaways delivered.