5 thrifty saving tips

Pay in cash

The hazards of credit cards are endless, mostly because using them helps you forget you're spending real money.

'Studies show people spend a lot less when they actually have to part with real money,' says Tom Butler-Bowdon, author of 50 Prosperity Classics.

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The average Briton has spent £3,685 on pointless purchases that they don't even use, according to Abbey research. Half of all people in Britain own an expensive item of clothing they've never worn, more than a third own uncomfortable unworn shoes and a quarter have unused exercise equipment.

Yet, while we waste money on inessentials, the majority of us don't save our cash at all, with two thirds dipping into our savings to buy treats, according to MoneySupermarket.com, and two thirds of people do not have an ISA either, says Nationwide.

But experts say that anyone can save, no matter what they are earning.

'It's a common misconception that some people can't save anything: anyone and everyone can make some savings, even if it's simply by making sure you pay a reasonable price for the basics in your weekly shop,' said Ross Dalzell, manager for Savings at Alliance & Leicester.

You may not get the instant gratification you might from buying a glamorous item, but seeing your property fund and pension pot multiply will be far more satisfying in the long run. Plus, having savings prevents you having to go into debt when emergencies inevitably hit.

'Build up an emergency fund that will cover your living expenses for three to six months,' suggests Tom Butler-Bowdon. 'If something happens you won't have to depend on the charity of others or go into debt.'

And believe it or not, with a little effort you have the power to make small lifestyle changes that could save you big bucks.

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