As the cost of living rises and annual wage rises disappear it is worth looking at some simple ways to save a few pounds. Financial expert Alok Dhanda gives a few tips.

WE’RE all feeling the pinch at the moment. With the fragile economy, doom and gloom on the high street and persisting job uncertainties – it’s easy to see why the country is feeling a little blue.

As the saying goes, if you take care of the pennies – the pounds will take care of themselves and I’m a firm believer in this. Households must scrutinise their monthly budgets very closely, now more than ever, and look for savings in every aspect of their lives. From food and clothing to utility providers, car insurance, internet and pet care – there’s lots to consider.

The first step is to take a look at your bank statements from the past couple of months. Make a list of your regular outgoings and try to identify any spending patterns. Do you tend to splurge after pay day? Have you been withdrawing cash that you can’t account for? Are you making regular trips to your local deli on your lunch?

Next, you need to look at how you can trim your expenditure. Although this might seem like a time-consuming, laborious task – it’s worth the effort as it could help ease the pressure on your bank account in the long-term.

For bigger outgoings, such as electricity and gas, take a look at the website www.uswitch.com  to find the cheapest options available. You might also want to reconsider your payment method, as some companies offer a discounted price for customers who pay by Direct Debit.

For home, car, holiday and pet insurance – it’s worth trying sites like GoCompare and Moneysupermarket. If you have life assurance, review your policy. For example, if you were a smoker when you took out the policy and now no longer smoke, you could save up to 50% on your premiums.

Food prices have risen sharply in recent months, with some items doubling in price in the past year alone. Supermarkets are now trying to out-compete one another, so it pays to shop around for the best deals. You should also think about cutting out pricier treats from your shopping list. For produce like fruit and vegetables, make a trip to your local market – the prices, and more often than not the quality, is better than that found in the bigger stores.

Many of the debt problems experienced by UK households relate to lifestyle and aspirations. We’ve grown accustomed to buying luxurious items that we can’t actually afford. It’s important to take a realistic approach to the lifestyle you lead and cut out unessential activities and purchases. When it comes to eating out, save this for special occasions only or look out for offers through popular websites like Groupon and Living Social. Or why not host your very own Come Dine With Me evening with friends as an alternative to an expensive night out?

You could also get creative in the kitchen to save some cash – make your own bread and cakes, and cook a little extra at meal times to keep for your lunch the following day. Something else worth considering is reducing your portion sizes so that items like rice, potatoes and pasta go further.

If you’re craving a new wardrobe in time for winter, think about giving your existing one a makeover. Amend your clothes to make them on trend for this season, by for example, adjusting the hem line or stitching on items like buttons or bows. Think about buying accessories like belts and brooches, which are considerably cheaper, to help transform your outfits.

We all have a little clutter around the house, from unwanted toys to books stashed up in the attic. Clear out your home and sell the items at a car boot sale or on ebay to raise some extra cash.

If your children have flown the nest, or you just happen to have a spare room available, generate revenue towards your mortgage payments by renting it out. Under the Government’s Rent a Room scheme, anyone who owns a property, which is their principal residence, can rent out a room charging up to £4,250 per year totally tax free.

All these ideas can help the pennies to accumulate, without you feeling significantly hard done by. Once you’ve got some extra cash at your disposal, you may want to invest it in an Individual Savings Account (ISA) or in the stock market. Alternatively, you might want to save towards a deposit for your first property or for your family’s future. Whatever your goals, an Independent Financial Adviser (IFA) can help you make that next step by offering impartial advice on the options available to you.

:: Alok Dhanda runs Dhanda Financial, 52 Dean Street, Newcastle upon Tyne, NE1 1PG, telephone 0191 255 8960, email alok@dhandafinancial.com  or visit www.dhandafinancial.com