How To Save When You're Skint

Laura Starkey shows you how to squeeze extra money from your monthly budget - and some smart ways to stash it.

This article was originally sent to Fools as a standalone email. 

We're just over halfway through April now, so hands up all those who are counting the days until their next salary payment arrives.

If you're holding an arm aloft, there's no need to feel ashamed. (In fact, I'm having to type this one-handed).

No matter how much we make, many of us find that we spend every last penny of our earnings. Somehow, despite having a regular income, it's easy to end each month skint.

Oh well. As long as you aren't in debt, it doesn't really matter. Does it?

Hey, Big Spender!

A lot of people certainly seem to think that spending is more important than saving. According to debt charity Credit Action, a recent Wealth and Assets Survey by the Office for National Statistics (ONS) found that around 14m adults have no savings or investments.

Meanwhile, 39% of people said they felt it was more important to "enjoy a good standard of living today" than to save for retirement. And a Post Office survey also recently found that 4.8m Brits are not saving regularly.

In my opinion, saving should be high up on anyone's financial priority list - especially at the moment, as our economy seemingly heads towards a slowdown.

ONS research scarily suggests that half of all UK households could survive for less than a month on the amount they have saved, should they need to.

But how do you save when you don't seem to have any spare cash?

Well, first of all, you try to find some.

Five Ways To Squeeze More From Your Salary

1.  Get a great current account. As long as you stay in the black, there are lots of current accounts that offer brilliant rates on balances - thus making more of your money. For example, Alliance & Leicester's Premier Direct Current Account offers a whopping 8.5% interest, fixed until the end of next April.

2.  Slash your bills. You don't always have to change the things you're buying to cut costs. Use price comparison sites for everything you can, from gas and electricity and insurance to CDs and books. (Try Find-cd.co.uk and Bookbrain.co.uk for good deals).

Also, don't be afraid to haggle with companies when you're an existing customer. One of the easiest costs to cut with a bit of skilful negotiation is your monthly mobile phone tariff.

3. Shop smart! Cashback websites such as Quidco can cut the cost of online shopping by giving you a percentage of the commission they earn.

Alternatively, cashback credit cards are a great option for anyone who pays off their balance at the end of every month. And remember to check out The Motley Fool's bi-weekly round-ups of Current Discounts and Deals. They're a great place to find offers on clothes, homewares, electrical goods and outings.

4. Shift down a gear. If you're a lover of premium brands, one sure way to save is to experiment with the next one down. This applies to almost everything, from supermarket meals to moisturiser. You'll probably find that many of the changes are barely noticeable, but they could shave a significant amount off your shopping bill.

Shifting down a gear also means slowing down. If you take time to plan your spending, it's less likely to get out of control.

I find deciding what meals I'm going to cook each week before going to the supermarket very useful. When I simply shop for items or ingredients, I'm always suckered into spending more!

5. Create a Big Brother budget. Knowing how much money you have going into and out of your accounts each month is important. 

However, if you tend to over-spend you need more control over your cash. One way to get it is to set up a system of direct debits that will siphon off money for bills, mortgage/rent payments, spending money and - you guessed it - savings, into separate places.

Also, when it comes to managing your money, I can't recommend internet banking highly enough. Being able to see the balance of your accounts at the click of a button can be incredibly helpful for big spenders!

Where To Stash Spare Cash

If you try the tips featured here, hopefully you'll soon be able to start saving.

Don't be put off if you can't spare huge sums - saving regularly now sets you on the right road for the future.

When it comes to deciding where to stash your savings, my recommendation would be to use a Cash ISA. Thanks to the new rules, you can now save up to £3,600 tax-free - and there are several out there with great interest rates.

One thing to ask yourself is whether or not you'll be safe with an instant-access ISA. Several years ago I had an ISA that came with a cash-card, which allowed me to withdraw savings from the hole in the wall...

Very sadly (but not all that surprisingly), it wasn't long until the balance on the account was £0!

Some ISAs, such as Scarborough Building Society's Notice ISA, require that you give 30, or even 60, days' notice to get at your savings - a bonus for those who struggle with self-control.

Other ISA accounts even require you to commit to a regular monthly payment. As long as you can afford it, these can be a good bet. The Regular Saver Cash ISA from Dunfermline Building Society offers a spectacular 6.85% interest on balances as long as you pay in a minimum of £10 per month. However, with ISAs like this one, the price of removing your money can be high.

While starting to save can be difficult, it really is worth the effort - and the sooner you begin, the better, thanks to the miracle of compounding.

What's more, the feeling that you're putting something aside for the future really can be just as enjoyable as the rush you get from spending.

Some might say you can't put a price on peace of mind... I say, pooh! You can, and that price can be as small as a spare £30 or £40 per month.

More: Six Cracking Cash ISAs |What Not To Buy |The Smart Way To Save With The Least Hassle | Earn Cashback On Everything!