How to Save Money in London: Practical Hacks

How to save money in London

How can I save money while living in London? Is it even possible?

It probably doesn’t come as a surprise to anyone that London is one of the most expensive cities to live in in the world. Even then, it’s possible to save money in London. You’ve just got to be savvy with your daily choices and money management. 

Below I’m sharing some practical tips and tricks on how to save money in London while still enjoying your life. Some of these saving hacks I’ve practised even before moving to the capital while others are very specific to London living and the challenges that come with it. I’ll even cover how to stop wasting money on the household problems related to the London hard water and limescale – and what to do instead to save money. This is something I was completely unaware of when moving here!

Let’s take a look at how you can start saving money in London.

Saving money on living & household costs in London

1. Change your energy and internet provider

Ensure you’re getting the best deals on your utility, internet or phone bills by shopping around. Comparison sites such as Uswitch or MoneySuperMarket are helpful tools for finding the most competitive prices. It’s a good practice to review your suppliers yearly to see if you’re still getting the best deal. Also, make sure you provide your meter readings every month so you only pay for what you have used!

For example, we managed to half our gas and electricity bill simply by switching from British Gas to Igloo Energy. The best rates and suppliers will of course depend on your personal usage and postcode, which is why the comparison sites can be extremely useful. 

In addition to saving money on your monthly bill, many energy providers also have some generous referral schemes when you recommend them to a friend. For example, by using my Igloo referral link here, you can get a £50 credit when you switch to Igloo. And you can get another £50 for every friend you refer to them – it’s a win-win! Another benefit of Igloo Energy is that they pay you 3% interest on any credit, i.e. overpayments, you have on the account. Much better than having the money sat on your bank account where inflation is eating it up! (This is not a paid promotion by the way, I’m simply a happy customer of Igloo.)

2. Move to a cheaper area or negotiate your rent

If the work you do doesn’t require you to live in central London (or any other expensive area), it’s worth considering living elsewhere. This can be a great way to save money in London, especially if you are working from home and don’t need to commute daily.

However, if you still want or need to live in the city centre, the good news is that rental prices in central London have actually dropped by 12.4% within a year due to the pandemic decreasing the demand. Therefore, now might be a great opportunity to find a good deal!

Because of the drop in rental demand in London, some landlords are also flexible with the prices. Therefore, it’s definitely worth asking for a discount when looking for a new place at the moment. In fact, we managed to negotiate £25 off from our monthly rent in our previous flat while also found our current place for a below market value rent!

London money saving tips: rent

3. Avoid the costs related to hard water in London

This might be obvious for those from London or eastern England where hard water is common, but the issues and costs that come with hard water were something completely new to me. In short, London hard water means that it has a high level of calcium and magnesium compounds, causing limescale. In money terms, this means that people tend to buy bottled water because of the taste of the tap water. In addition to this, home appliances that get in touch with water, such as kettles and washing machines, can be easily ruined. Luckily, I’ve found a few tips to avoid this and the costs associated!

Hard water - dos and don'ts to save money

First of all, don’t buy bottled water if you want to save money in London. Although the taste of tap water is not great for an outsider, it’s safe to drink. However, if the taste does bother you a lot, invest in a Brita water filter or kettle. These are much better options for your wallet and the environment than bottled water!

Secondly, I threw my kettle in the bin and bought a new one just after 3 months in London due to the limescale built up. Only if I knew at that point that there are actually many easy ways to clean a kettle to get rid of limescale! Now that I have done this mistake and wasted my money, you don’t need to do the same 🙂

London hard water also affects your skin and hair. According to dermatologists, hard water can cause an irritated scalp and skin, lifeless hair and clogged pores. It can also worsen certain skin conditions, such as eczema or acne. Therefore, instead of spending loads of money on expensive treatments or skin and hair products, get a filtering shower head. This is something I bought as soon as I leant how hard water can ruin your skin.

Finally, if you are a homeowner in London or planning to be one, it might even be worth looking into investing in a water softener. This can help you save money by reducing cleaning costs and making your appliances (washing machine, dishwasher etc.) last for longer.

How to save money on food in London

4. Shop smart

Food is an unavoidable expense, but spending a fortune in the supermarket isn’t necessary. Here are some easy tips on how to shop smart to save money when living in London:

  • Change where you shop: It probably doesn’t come as a surprise to any that Lidl and Aldi are the cheapest supermarkets in the UK. We are a two-person household and saved around £100 per month after started shopping in Lidl instead of Asda. Not only does this save us money because the prices, in general, are cheaper but the Lidl we shop in also has daily reduced offers. This makes a big difference in how much we spend on meat and fish which are usually the priciest food items.  If you live in central London or somewhere else where you mainly have local shops, you can save money by taking a shopping trip to a bigger and cheaper supermarket once a week.
  • Find the best times to go food shopping: For the best bargains, go food shopping at the first opening hour or late in the evening. This is when all the items that go out of date the same or following day will be significantly reduced. Alternatively, find out when your local shop adds the reduced stickers every day and shop accordingly. When you’ve found a bargain, you can freeze the food to eat it at a later date.
  • Use supermarket cashback apps or loyalty schemes: Supermarkets’ own loyalty schemes allow you to earn points on your shopping or give you access to exclusive rewards. In addition to the loyalty schemes, there are also various cashback and offer apps you can use. For example, in Shopmium you can find offers for different products in all the main supermarket chains.
  • Don’t fall for psychological tricks supermarkets use to make you spend more: Don’t buy something just because it’s on sale. For instance, a ‘buy on get one free’ offer is only bargain if you actually need both products.

5. Be savvy when having takeaway food and coffee

I’m sure you’re tired of hearing saving advice that tells you to quit having takeaway coffees and food if you want to save money in London. Unfortunately, I can’t disagree with this advice but I do understand life is meant to be enjoyed too! With this being said, here are a couple of hacks on how to enjoy takeaways cheaper:

  • Take your own cup to a coffee shop: While most coffee shops give you 25-50p off from a hot drink when you use your own mug, others offer you one for free! This might not sound like a massive saving but can make a big difference long-term if you are a regular coffee shop goer. In addition to saving you money, avoiding disposable cups helps you to support a more sustainable future.
  • Go to a university café instead of a coffee shop chain: Another way to save on takeaway coffees is to find a uni campus café. They are open for everyone but the prices tend to be lower and more student-friendly.
  • Find bargains on anti-waste food apps: Apps like Too Good To Go and Karma allow you to get access to unsold, surplus food from London restaurants, bakeries and supermarkets. You might not always be able to choose what you get but you can surely find a good bargain while helping to reduce food waste.

Money saving tips on transportation costs in London

6. Get a railcard discount on your Oyster card

Since you can ride across London simply by tapping your contactless card, it’s easy to lose track of how much you spend on transport. With this in mind, if you are 16-30 years old, I would highly recommend getting a railcard and connecting it to your Oyster card. Railcard only costs you £30 per year but it gives you a 1/3 discount on off-peak travel. It’s valid both for the London tube and for train journeys across the UK. Accordingly to Railcard, the average annual savings are up to £251!

7. Reconsider if you need to take the tube

Did you know that the walking distances between central London tube stops are often less than 10 minutes? For all those times you’ve guiltily taken the tube just one or two stops – you now have no excuse. Walking is of course the cheapest method of transportation in London. However, if you need to travel longer distances, a bike is the next best option. You can either invest in your own bike or hire one using Santander Cycles, for example.

Electric scooters are also becoming more and more popular. Although they can cost a couple of hundred pounds, electric scooter might save you time and money on short to medium distance commutes in the long run.

Finally, if none of the above options are viable, check if you can take a bus instead of the tube. Bus might sometimes be slower but is often also cheaper than the tube. While the amount that you pay for each tube trip is determined by the number of zones travelled, this doesn’t apply to busses. Each bus journey has a fixed cost regardless of zones or distance travelled.

How to save money in London transport

8. Compare taxi apps

Everyone knows black cabs are expensive and should be avoided if you want to save money in London. You are probably already using Uber, Bolt or some other ride-hailing apps. But did you know that there can be significant differences in prices even between the apps? Therefore, download a couple of different apps and always compare the prices before travelling. When travelling long distances or going to the airport, for instance, it’s also worth getting a quote from a local taxi company.

Easy hacks on how to save money on leisure & entertainment in London

9. Find online deals

When it comes to personal care, check out deal sites such as Groupon, Wowcher and Treatwell. Thanks to these sites, I haven’t paid normal prices for things like hair appointments and spa days for years! While Treatwell is focussed on hair and beauty appointments, Groupon and Wowcher offer pretty much everything from holiday and restaurant deals to fitness classes.

10. Make the most of free activities in London

As a buzzing capital, London surely has lots of entertainment options to offer for all budgets. If you are wondering how to save money in London while having fun, here are a few tips for free activities:

  • Discover free museums and galleries: If you like to experience a bit of culture, you’ll be happy to know that many London museums and galleries are actually free. This includes the world-famous culture spots such as the British Museum, Natural History Museum and National Gallery
  • Join free fitness activities: Sports brands including Adidas, Sweaty Betty and Lululemon often organise free fitness classes in their stores or outdoors. Many of them have running clubs but you can find yoga and fitness classes too.
  • Enjoy views across the city: Instead of going to a pricey rooftop bar for views and photos, head to Sky Garden’s viewing gallery for panoramic views over London. It’s completely free! Alternatively, if you prefer outdoor views, Primrose Hill (pictured below) and Hampstead Heath’s Parliament Hill are great options.
Save money in London: Free activities

Save money in London while enjoying life

London is one of the most expensive cities to live in in the world. That we know already. But we’ve now discovered that there are various ways to enjoy what the city has to offer while sticking to your budget. I hope this article gave you some new ideas on how you can save money while living in London! And if you want to boost your income to be able to save even more, read my articles on side hustle and passive income ideas. These additional income sources can help you to reach your financial goals faster without having to change your lifestyle notably. 

And if you are ready to take a step to get even further with your saving journey, a no-spend month is something you should consider.

Practical hacks on saving money in London
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