There’s a whole host of reasons why you might want to save money. Perhaps you’re trying to get out of your overdraft. Or you might be thinking of buying your first home. Maybe you’re just saving up for a dreamy two week holiday. But what happens when saving money doesn’t come naturally to you? Read my top five money saving tips below for a helping hand on improving your finances!
1) Start today:
It can be difficult to find the motivation to start saving when you don’t have anything in particular to save for. But there will come a day when you might love a nice holiday or to buy your own house. Even if you don’t have huge amounts to put away, remember the phrase “little by little, soon becomes a lot”. The sooner you start saving, the sooner your savings will grow! If you ever need some extra motivation, think about how great it will feel when you finally know what you’re saving for -to already be on your way toward reaching that financial goal.
Over the last few years I have added money into a savings account, without really knowing what it was for. When I decided I wanted to take six months off work to travel, I was already well on my way towards my savings. This means I then didn’t need to dramatically alter my lifestyle to be able to save the money I need for my trip!
2) Get Organised:
Create a financial routine that works for you, with a realistic budget that allows for a controlled freedom to spend. Money bloggers always talk about setting a budget, but it really is an important step in sorting out your finances! I would start by understanding how much money you have coming in each month. I would then work out how much money has to go out each month (e.g. your fixed expenses). This then leaves you with how much you have left to play with.
If you are paid £1,500 a month and your rent, bills and travel costs £1,000, then you know you have £500 left for free spending. Knowing the numbers allows you to set an easy to follow routine. Each month you’ll then know where your money needs to go.
I find it easiest to keep separate accounts for each area of my finances. My bills are paid from a regular account, my savings go straight into a high interest account, and my monthly spending allowance is added onto a Monzo card.
Knowing each month that my bills and my savings are sorted, reduces a lot of money stress and means I only have to focus on keeping my Monzo account in a good condition. With time and a little effort, paying bills and adding to your savings will feel less like an intimidating task, and more like part of your normal routine.
3) Assess your spending:
Spend time looking at your monthly outgoings and assess how each purchase made you feel. If you spent £100 on Topshop lounge wear this month, or £30 in Boots on a variety of non-essentials, and you feel okay with that, then continue spending in this way. If you had no idea it was adding up to that much, and that number puts a knot in your stomach, then now is the time to assess this spending habit.
It is however important to note that the key to being mindful with your money isn’t about cutting out everything you enjoy in life. It’s more about making small adjustments to the areas of your life you can live without.
I find that thinking about my short term spending vs my long term goal is a great way to assess how and what I should spend my money on. Do I want to spend £50 on a dress to wear on a BNO to Barrio’s, or is that money better saved for a holiday I’m planning next year?
4) Don’t wait for a pay rise:
Earning more money is a great way to boost your savings, but this isn’t an option you should rely on. Instead, think about little ways you can spend less. Spending some time to review things like your gas or phone bill can end up saving you hundreds of pounds a year – it may be super boring, but it is definitely worth it.
Put a reminder in your phone when your contracts are ending and make sure to get in contact with the relevant company. It often doesn’t pay to be a loyal customer, so make sure you look around for better offers. I’ve had big success with switching energy companies, speaking to my broadband provider, and downloading apps that help you save on your bills, such as Plum and Airtime Rewards.
But it doesn’t stop with bills, there are hundreds of little ways you can save money on everything from fashion, food and travel – it will take time to get into this thrifty way of life, but it is definitely worth it when you can finally reap the rewards!
5) Don’t be ashamed of saving money:
And lastly, it’s important to remember that being mindful with your money, having financial goals and a kick ass budget, shouldn’t be mistaken for being a cheapskate. It can be difficult to discuss money with your friends, but like anything, the more you talk about it the easier it gets.
Let your friends know your plans. Explain why you’d prefer the cheaper restaurant. Switch “I’ve got no money” into something more positive like “I’ve got other plans for this money”. Some of my favourite budgeting methods and money saving tips are from friends I’ve had the money-talk with, so open up and start sharing ideas! I’ve also found that telling someone you’re trying to save money is a great way to keep yourself accountable and really helps to stop you from impulse spending!
I hope these tips will help you on your money saving journey! It’s not an easy journey, but it’s well worth it!