In our weekly series, How I Save, we’re getting into the nitty-gritty of how people spend and save their money.
Each week we ask someone to track their spending for a week and share what’s in their savings account, then get them some expert advice on how they could boost their savings.
This time around we’re chatting with Sam*, a 47-year-old dad and systems analyst in County Down. Heads up – he’s a man of few words.
How Sam saves:
I earn £38,000 a year and in my savings account right now I have £300.
I’ve saved this money in lockdown. The main way I save is by working from home and appreciating the simple pleasures, like watching TV and listening to the kids’ stories.
I also order groceries online, shop around, use a permanent razor, and avoid brand names unless it brings real value. We subscribe to Petrolprices.com for updates on where fuel is cheapest.
The kids save money by obsessing over video games rather than toys but we’re not too comfortable with that. We encourage them to build their own toys from Lego and cardboard.
I’m trying to save for a mortgage deposit.
I struggle with saving because I love chocolate. Also, modern life is overpriced.
How Sam spends:
- Rent: £595
- Car insurance: £55
- Broadband: £22
- Student loan repayments: £102.42
- Gas: £120
- Amazon Prime: £8
- National Trust: £10.50
- Netflix: £12
- Mobile service: £20
- Electric: £50
- Diesel: £100
- Food: £500
- Car Finance: £650
- Loan repayment: £100
A note from us: You’ll notice very little spending in the week Sam tracked… bear in mind he’d already done a big food shop!
A week of spending:
Monday: Nothing spent.
Tuesday: Nothing spent.
Wednesday: Milk and burger baps for £2.05.
Thursday: Nothing spent.
Friday: Nothing spent.
Saturday: Nothing spent.
Sunday: Nothing spent.
Total spent this week: £2.05
How Sam could save:
We spoke to the experts over at Plum, the smart app for managing your money to find out how Sam can save better (and what we can learn from his spending… or lack thereof).
Here’s what they said:
Having spoken about how overpriced modern life is, you’re incredibly frugal with your spending, coming very close to achieving a no-spend week!
While we definitely admire your thriftiness, you admit yourself that your current financial situation is mainly due to the impact of lockdown.
As life slowly becomes a bit more normal, you should continue to track your spending habits, to make sure they don’t shoot right back up. Plum’s Diagnostics feature could help you with this, tracking and categorising your spending to let you know exactly where your money’s going.
The bulk of your spending right now is on your monthly bills and subscriptions, therefore you should keep a close eye on these if you’re really looking to save those pennies.
When it comes to saving, you could be doing a lot more with your money. £300 will not get you very far, so if you’re serious about that mortgage payment, you need to up your game!
Based on the salary you’ve shared, when your monthly expenses are accounted for, that leaves plenty of disposable income that could be saved while still funding that chocolate addiction.
If you’re not sure how much money you should be setting aside, a good idea is to follow the 50/20/30 rule: Allocate 50% of your income to essentials (like bills), 20% to your savings and leave the final 30% as spending money.
Alternatively, if saving’s really not your strong suit, downloading a money management app like Plum could take some of the responsibility off your shoulders. Plum acts as a brainy assistant, scanning your bank account to work out what you can afford to set aside, and automatically putting money away every few days so it’s out of temptation’s reach. This would allow you to effortlessly build up your stash over time, and get you closer to your home-ownership goals.
Equally, if you wanted to take more control of your finances, Plum can be tailored to suit your own individual strategy. You can select your ‘mood’, telling Plum to put away more, or less, than usual, use the Splitter to divide your savings automatically between different goals, or switch on PayDay deposits to ensure that part of your paycheck is automatically set aside as soon as your money comes in.
With just a few simple steps, you can finally be the boss of your own finances.
*Name has been changed.
How I Save is a weekly series about how people spend and save, out every Thursday. If you’d like to anonymously share how you spend and save – and get some expert advice on how to sort out your finances – get in touch by emailing [email protected].
If you want more tips and tricks on saving money, as well as chat about cash and alerts on deals and discounts, join our Facebook Group, Money Pot.
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