If your monthly income is only covering your essential expenditure, you’ll want to do everything you can to increase your disposable income.
After all, it’s your disposable income that can be used to pay for the fun things in life, like concert tickets, holidays, and adventures. When you have more disposable income, you can even increase the amount you’re saving to safeguard your financial future.
Of course, everyone wants to have more money, so how can you go about revising your finances? To get started, take a look at these five ways to boost your disposable income now:
1. Create a Budget
If you don’t already have a personal or household budget in place, it’s time to create one. You can do this manually, simply by writing a list of your income and expenditure, but many people prefer to use a dedicated app. With automated additions and timely reminders, digital budgeting can eradicate errors and make it even easier to manage your money.
Once you see where your money is really going, you’ll be able to make savvy changes to your spending. Often, it’s possible to save a considerable amount each month without missing out or living a particularly frugal lifestyle. Start by creating a budget and then assessing which costs can be reduced.
2. Switch to a New Utility Provider
Utilities, such as gas, electric, and water, don’t come free, but you don’t have to pay an excessive amount for them either. New customers typically benefit from the best deals, so if you haven’t changed your tariff or provider in a while, there’s a good chance you’re paying more than you need to.
When you compare gas and electric deals, you can find the best dual fuel tariffs and see how much you could save instantly. By searching on a comparison website, it’s easy to compare gas and electric tariffs, regardless of whether you’re looking for a dual fuel, fixed rate, variable rate, economy 7 or green tariff. You can even find better pre-paid gas and electricity deals, which means virtually everyone can reduce their expenditure by finding a cheaper utilities provider. Search for the latest deals on a comparison site like Quotezone. You can also use the site to find cheaper motor and travel insurance.
3. Start Meal Prepping
One look at your budget will tell you how much you’re spending on groceries and, chances are, you’re spending far more than you realised. As well as your weekly grocery shop, be sure to factor in the extras you spend money on, such as snacks at a convenience store or a takeaway coffee on the way to work.
If you want to reduce the amount you’re spending on groceries in order to boost your disposable income, meal prepping is a great way to do it. By preparing meals in advance, you can reduce waste and get the most out of your budget. Furthermore, meal prepping saves you time in the kitchen and can motivate you to eat a little healthier too.
4. Start a Side Hustle
Increasing your earning power is a sure-fire way to optimise your disposable income, so why not consider starting a side hustle? With the opportunity to create your own venture and earn extra income from doing something you enjoy, a side hustle can be a fun way to generate more revenue.
What’s more – many people use a side hustle as a test to see whether they’re suited to life as a freelancer or as a business owner. If you dream of being your own boss, a side hustle gives you the opportunity to test the water while retaining your current job. Combining security with flexibility, starting a side hustle can be a fantastic way to find a new hobby and increase your disposable income.
5. Reduce Your Tax Liability
If you’re an employee, you’re likely to be paying income tax via the Pay-as-You-Earn (PAYE) system. Although this is calculated for you, it’s worth checking that HMRC is using the right tax code to calculate your liability. It’s not uncommon for people to realise that they’ve been taxed at too high a rate, which will have an impact on your disposable income.
Additionally, it’s vital to find out whether you’re eligible for any forms of tax relief, grants or benefits. If so, you can reduce the amount of tax you pay and/or obtain extra income.
For freelancers and business owners, making savvy decisions in relation to your business structure and expenditure can substantially reduce your tax liability. With advice from a professional accountant or advisers, you can find the most effective ways to reduce your liability and optimise your income.
Enhancing Your Money Management Skills
Taking control of your finances gives you the ability to boost your disposable income. Although it can seem daunting to review your financial situation, it’s vital to be aware of how you’re managing your money and what your finances mean for the future. With a little readjustment now, you can transform your situation, maximise your disposable income and look forward to a bright financial future.