Over the past few months, saving as much money as I can has become my absolute priority. And that’s because, if you didn’t already know, I’m moving house in the summer and it’s costing me a LOT of money! It’s therefore essential at the moment that I save as much as I possibly can. So far I’ve surprised myself with how disciplined I’ve been and how much I’ve actually saved. To be honest, if I hadn’t saved this much then I wouldn’t be moving house because I couldn’t afford it, so I kind of had no choice! But I’m pleased that I’ve stuck to my guns and to my saving plan.
So how have I done it and what are my top tips for saving?
Making a plan
I’m a big believer in planning and especially when you’ve got a specific end goal in mind. And this has really helped me saved the money I need for the new house. Regardless of the period of time over which you need/want to save and regardless of what you’re saving for, making a plan really works and is the key starting point.
Set yourself a goal on how much you need to save. Depending on what you’re saving for, that goal might be years in the future or it might be only weeks or months away. But you’ll know how much you’ll need to save and that’s your target. Then work out how many months you’ve got between now and when you need to have saved by. Then work out how much you’ll need to save each month to reach your target amount.
Be realistic though. If you only earn £1,000 a month for example and your goal means you need to save £900 a month, that’s clearly not going to happen! You probably need to readjust your timescale a bit.
Have a strict budget
Having a budget sounds like a no brainer. But I don’t mean a budget for your target amount, I mean a strict budget for your every day spending. This is how I’ve planned my finances for years and has worked a treat for me.
Each month I write down every single regular outgoing on a list and cross them off as they come out of my account. This is basically just the absolute essentials needed for living – like mortgage payment, bills, food shopping etc.
In addition I have a set weekly budget that I’m very strict on not exceeding. This weekly amount is intended to cover any regular outgoings that I know I’m going to have during the week (like petrol for instance or additional food shopping). Any money that I don’t use that week then goes into savings. From your monthly earnings, you now know what your outgoings are going to be, including your weekly budget, and now you can work out how much disposable income you’re going to have – i.e how much you’re free to do whatever you want with!
I have always found it better to include my set monthly savings amount as part of my outgoings and I therefore include it as part of my monthly budget. That way I know I’m saving a set amount each month and the money that’s left over is truly disposable! I.e money to play with 😉
And then, when it comes to your disposable income:
Look for alternatives
If you look really closely at what you spend your money on, there will undoubtedly be stuff that adds up to much more than you expect. Like buying coffee for example, or buying lunch every day. Spending the odd £2 here and £3 there soon adds up across a whole month. So try to look for cheaper alternatives to things you buy regularly.
Take lunch for example. If you bought lunch every day at work it would probably cost you between £3 and £4. That’s about £15 to £20 a week on a 5 day week, and about £80 a month. What if you bought stuff to make lunch with every day? It’d be much cheaper wouldn’t it? It might mean you need to spend an extra 10 minutes of your time in the morning or evening preparing lunch, but surely better that than spending more money? Especially if you’re saving for something specific and in a tight timescale!
I remember a few years back I used to buy a cup of tea at work twice a day every day. When I eventually totalled it all up I was spending about £30 a month just on TEA?!?!? OMG. We had a hot water tap at work, so I made a change by buying tea bags which cost me about £2.50, a bag of sugar for about £1 which lasted a couple of months and then just a little bit of extra milk during the week. Basically, I saved myself £25 a month by just not buying tea in the canteen twice a day! Such a simple change but very good on the finances.
Be prepared to sacrifice some stuff!
This will particularly be the case if you’re intending to save lots in a short space of time. You’re going to have to give up some stuff. That’s a harsh reality I’m afraid! Eating out, going out, visiting places, new clothes – it’ll all have to go in the short term. Believe me when I say this is especially tough. It can feel like you’re trapped in a boring life where everyone else is having a great time and you’re the boring friend. So I don’t advocate this if you’re looking to save over the long term. But in the short term, just suck it up!
That’s precisely what I’ve done. I’m living a boring a life for a few months in order to live a better life in a few months time! That’s how I look at it. I’m sacrificing quite a lot of life stuff whilst I’m in this interim period living at mums, but the prize at the end will be my beautiful new house! And once I’ve moved in, I can get back to being less boring again. Like I said, it’s hard. It feels like your life is on hold – but to be honest, it is. Until you’ve achieved what you need to achieve in terms of your savings goal and then you’re free again!
Do try and treat yourself every now and then
I would say this is particularly important if you’re looking to save over the longer term. You’ll still need to sacrifice a lot of stuff to reach your savings target, but you’ll need to treat yourself to some things every now and then. The odd meal out here and there, a new item or two of clothing – it won’t hurt! In fact it’ll be good for you. Just don’t go overboard. There’s still a target to be reached!
Now, all of the above sounds really easy and in a way it is if you’re motivated enough to want to achieve your goal. For me, my goal is a new house and I need to save shed loads in a short space of time, so all the above is working for me. But everyones circumstances are different and it’s all a bit of a balancing act.
I consider myself very lucky that I’m even in a position to save any money at all, let alone save to buy a house! I fully appreciate not everyone will be able to use these tips. But if you are able to, I hope they help and you’re able to save for something spectacular!
Until next time folks, much love! x