How to increase disposable income
When money is tight, increasing your disposable income might seem impossible but even small changes can make a real difference. Whether it’s cutting back on fixed costs, reducing everyday spending, or finding ways to earn a little more, improving your disposable income means you’ve got more flexibility to manage your finances, deal with debt, or simply afford the essentials.
In this guide, we’ll walk through how to improve your disposable income in the UK, offering practical, realistic steps and explaining what to do if those changes still aren’t enough.
What is disposable income?
Disposable income is the portion of your earnings that remains after you’ve paid all your essential and priority expenses, such as rent or mortgage, utilities, taxes, insurance, and debt repayments. It’s the amount you can spend, save or use for emergencies once your obligations are covered.
To calculate it, you subtract your total monthly expenses from your total income. You can use our disposable income calculator to work this out.
Start with your fixed costs
Your fixed costs are regular, often monthly, bills that don’t change much like rent, broadband, mobile contracts, insurance and subscriptions.
Here’s how you can tackle them:
1. Switch providers
Compare broadband, phone, and insurance providers annually – loyalty rarely pays. Use comparison tools to check if you can get a better deal.
2. Check your council tax band
You might be in the wrong council tax band. If your home’s been wrongly assessed, you could get a rebate.
3. Speak to your landlord or mortgage lender
If you’re struggling, it might be worth asking for a temporary reduction or switching to interest-only mortgage payments (if eligible).
4. Cancel or downgrade
Review all direct debits and subscriptions. Do you need all of them? Cancel anything you don’t use or look for cheaper alternatives.
5. Reassess insurance
You may be paying for insurance you don’t need or could get cheaper. Look at policies for mobile phones, pets, or appliances and make sure you’re not duplicating cover.
Earn more, spend less: practical ideas
Sometimes boosting your disposable income means cutting but it can also mean increasing your earnings. Here are some ideas that could help:
1. Increase your hours
If you’re on a part-time contract, check if more hours are available. Even an extra shift a week could help.
2. Use your skills for side income
Can you bake, write, fix things, tutor or design? Offering your services locally or online as a side hustle could bring in extra cash.
3. Sell unused items
Decluttering not only clears space – it could also bring in a few hundred pounds. Try local Facebook groups, Vinted, or eBay.
4. Use cashback sites and discount apps
Get a bit back every time you shop. It won’t make you rich, but over a year it can add up.
5. Try community swaps and shares
Some neighbourhood groups offer tool shares, baby clothes swaps or communal gardens, all of which can save money.
6. Explore remote and flexible work
Many platforms now offer freelance or flexible work in things like transcription, customer service, and virtual assistance, allowing you to earn from home in your free time.
7. Rent out space or items
Got a driveway, storage space, or tools you don’t use daily? Some websites let you rent these out to others for a small fee.
Revisit your everyday spending
Even if you’ve already tightened your belt, it’s worth reviewing daily habits. Small tweaks can make a big difference:
- Plan meals in advance to reduce top-up shops and takeaways
- Use a spending diary to track what you buy on impulse
- Shop late in the day for reduced-price items
- Walk or cycle short journeys instead of driving or using public transport
- Bring lunch and drinks from home rather than buying out
- Batch cook to save money and time through the week
- Try a no-spend challenge for a weekend or week to reset your habits.
Check what support you’re entitled to
It’s always worth checking if you’re missing out on help that could boost your income:
- Use the government benefits calculators to see what you may be eligible for
- Ask your local council about hardship grants or Discretionary Housing Payments
- Check for energy bill support, childcare help or local cost-of-living schemes
- See if you’re eligible for council tax reductions, free school meals, or Healthy Start vouchers.
What if you still don’t have enough?
Sometimes, the problem isn’t how you’re managing your money – it’s that your income simply doesn’t match your expenses. If that’s the case, you might need extra support.
You can get free debt advice from MoneyHelper. Alternatively, at MoneyPlus, we offer confidential, regulated advice to help you understand your options. Get in touch with us and we’ll help you take the next step towards a more manageable, stable financial future.
