Inflation and rising prices: 5 tips on how to save over €1,000 in just a few minutes

Our guest blogger Tobias from Finanzentdecker shows you how you can save over €1,000 a year with 5 simple tips

7 minute read2022-06-28
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Inflation is hitting us all hard right now. Whether in the supermarket, at the petrol station or on the electricity bill: everything’s becoming more expensive – which not only puts a strain on our wallets, but also on our nerves. The good news is that you can do something about it. With these 5 tips, you’ll save over 1,000 euros in just a few minutes.

A little inflation is normal and even good for a healthy economy. But it becomes a problem when it grows too quickly. Money losing value at a rapid rate can lead an entire economy to spiral out of control. What’s a healthy inflation rate, you ask? If prices (and ideally also wages) rise between 1.5 to 2 percent per year, this ensures steady economic growth by keeping us away from deflation. Deflation is the exact opposite: everything becomes cheaper. Why is that a bad thing? Well, because it means that people will stop consuming. They will postpone purchasing decisions in the hope of prices falling even further. That’ll turn into a disaster before too long!

In this respect, inflation is not really the bogeyman it is often made out to be in the media: as long as it remains under control. The war in Ukraine, supply chain difficulties, the still ongoing Coronavirus pandemic – all these events are currently driving up prices. Some groceries and energy costs in particular are more expensive than ever before. We feel this whenever we go shopping and will notice it next year when the electricity and gas payment is due.

Don’t worry, with the following simple tips you can save a lot money. Granted, this may not compensate for all the additional costs you’re dealing with. But you can at least cushion the blow on your account a little. You’ll see: there are a lot of everyday things you can do to free up more cash.

Tip 1: Check your energy costs

Energy costs, i.e. electricity and gas, are currently the main drivers of inflation. What many people don’t know: Comparing electricity and gas prices only takes a few minutes. Once you have decided on a tariff, it’s just a few clicks to switch.

We at Finanzentdecker have done the maths for you: For a 50-sqm flat in Cologne with an estimated gas consumption of about 5,000 kWh, the difference in price between the most expensive and the cheapest offer on a large comparison platform is around 40 euros per month or 480 euros per year. For electricity, it’s another 50 euros per month or 600 euros per year.

So a comparison with your current energy suppliers can be worth four figures per year. By the way: it’s worth repeating such a comparison every year.

Tip 2: Don’t pay too much for your bank accounts

During the low-interest phase of recent years, banks earned less money from their core business. Many then started charging account management fees or even negative interest rates for funds deposited on custody clearing accounts. In this way, branch banks in particular try to pass on their larger cost blocks to the customers.

In times of direct banks and neobrokers, this is no longer necessary. There are many free current accounts, credit cards or brokers that you can use without any account management fees or negative interest. Since bank customers typically pay an average of 4.55 euros per month for their current account, this again amounts to a saving of over 50 euros per year.

Tip 3: Compare your insurance policies

As with energy suppliers, it’s also a good idea to check if you can save on your insurance policies. Many of us have let them run unchecked ever since we bought them. However, it makes sense to review your policies every one to two years and see whether they still fit your lifestyle or whether there are cheaper alternatives.

Have a look at Getsafe’s prices, for example, to find out what you pay for a comparable service with other insurers. Depending on your situation, this can also result in savings of low to mid three-digit amounts per year.

Tip 4: Check your account transactions

Sometimes the savings potential lies in the details: a streaming subscription, a gym membership or a standing order that you no longer need. Free yourself and let them go! To find them, take a good look at your account statements from the past three months and check whether you’re aware of all the payments or whether you have any subscriptions or standing orders that are not necessary.

Depending on how strictly you screen here, you can save many euros per month which may amount to a three-digit amount per year. For example, one cancelled streaming subscription that costs 12 euros per month will save you 144 euros per year.

Tip 5: Invest your savings

If you’ve put these tips into practice, you might have come up with some more ideas on how you can save big now and in the future. The basic principle is always the same: regularly check what expenses you really need and what can perhaps be completely or partially cut.

What to do with the money you have saved? Invest it. The broad stock market is gaining about 6 to 8 percent per year over the long term. Even if you can merely compensate for the current inflation of about 7 percent, there will be times when inflation calms down again.

Conclusion: Inflation is currently a problem, but you are not at its mercy.

Inflation is making life difficult for all of us at the moment. But with just a few tips and a little effort you can save a lot of money per year! Most importantly: hang in there and don’t lose heart. There are better times ahead.

Author: Getsafe