I’ve said it once and I’ll say it again. Saving money whilst living in London and earning under 50k a year feels like actual mission impossible.
I’ll go as far as to say that even if you earned over that amount, saving in a city designed to suck your finances out of your bank account every payday Friday faster than you can say ‘three wildly overpriced espresso martinis please’ is no mean feat.
As someone who is wildly bad with money, the thought of saving was a laughable concept for many a year. Having a savings account with actual money in it was about as elusive as being the kind of person who did all their Christmas shopping in November, or had their hair cut every six weeks instead of turning up at the hairdresser looking like Hagrid’s hairier cousin.
But suddenly I found myself needing to build some form of savings in order to move to the other side of the world. Shit had got incredibly real.
So if you’re struggling to save your pennies, here’s some tips from someone who managed it despite being a permanent resident in their overdraft and once had their card declined trying to buy a pint of milk and some biscuits in Sainsbury’s.
Set up a spreadsheet
Urgh, this is so dull I can’t even but it really is the best way to get on top of your spending and work out some form of budget.
May I suggest seeking out your most sensible friend – you know, the one who went straight into a job in finance and has scary adult things like health insurance and regular dental check up’s.
My sensible friend in question nearly crapped his pants in excitement at the thought of getting his hands on my absolute car crash of a bank account. I think he actually rubbed his hands together in Mr Burns style delight.
The idea is to break down all your outgoings (rent, bills, gym etc), total them up and subtract them from your incomings. Crucially you should include your savings in here. Then you calculate your remaining play money. I like to work this out per week so that every day feels like a pay day Friday.
If you need extra help (like me) you can then document all your spending in the spreadsheet each week to work out whether you are over or under budget.
Here’s an example. Feel free to steal! Just tap in your numbers and it calculates everything for you. It’s a dream. (Remember to copy it into a new doc though or I’ll be privy to your private info – ooh err). Ps – those numbers in there are in no way reflective of my paltry earnings.
All I know is that it kept me on track and also let me play around with how much I could save. On months where I felt more flush I upped the savings level in my outgoings column. On months were things were tight I dialled it down.
It also gave me a cold hard look at my spending habits. When you’re writing it all down there really is nowhere to hide.
Take it from me, there’s no wake-up call like insisting you’ve been a victim of credit card fraud only to find out that, actually, no one has robbed you – you just spent FIVE HUNDRED pounds in pret on hungover cheese and tomato croissants in the course of one month.
Don’t go wild on payday
For me my life used to follow this slightly vicious cycle.
A week before payday: total and utter misery of cold war standards. Scraping together meals with the odds and ends of shit in the back of the freezer and cupboards. Baked beans and rice anyone? Berating self for lack of control and full of good intentions for next month’s pay check. Avoiding social engagements like the plague unless being paid for by work.
PAYDAY: Callooh Callay joyous day. Suddenly have cash and am filled with Joie de Vivre and the (frankly incorrect) idea that I am now some sort of Russian Ogliarch and the very idea of budgeting is absolutely insulting. Go out for work drinks and get absolutely bat shit. Find yourself at bar ordering espresso martinis and jaeger bombs with Andy from accounts who you’ve never spoken to before but now think you might possibly shag if given half the chance. Why why why.
Day after payday: Fuck.
Two days after payday: Why, Why, Why – hangover still not subsided. Vague memory of leaning over the bar with your debit card and saying ‘I got this babe’ to accounts Andy. Pay rent, bills, credit card and transfer those overdue bits of cash to people for various birthday presents, hen do’s, wedding presents (STOP IT EVERYONE) etc. Realise have two hundred pounds to get you to next paycheck.
This is everything that is both gloriously right and hideously wrong with pay day Friday. The excitement is far too much and unless you have willpower of steel you will definitely spend more than intended.
So what can you do to combat this aside from skipping the pay day drinks altogether (might as well just be dead).
I found that immediately transferring all my pay into a savings account save for my budget for the evening really helped. Sure sometimes I’d find myself swaying on a pavement with one eye open jabbing at my online banking to pop over some more cash but more often than not it was the deterrent I needed.
Just try not to kid yourself that you are some insane millionaire just because it’s payday. Don’t buy everyone who breathes on you a drink. Remember – it’s their pay day too.
Choose one thing you can live without
Saving can feel wholly overwhelming until you remember that small sacrifices can add up to a lot.
Trying to save 500 pounds a month might seem impossible. But giving up your daily coffee in favour of making one in the office might seem much more realistic.
Equally maybe you could ditch your gym membership and run outside instead, or start walking or cycling to work instead of buying that eye watering monthly tube pass. Whatever you can cut out without missing it too much – just do it. It’s free money in your pocket.
Use helpful apps
There are literally hundreds of apps out there that can help you set budgets, track your spending, save without noticing etc. So just find the one that’s right for you.
My friends in particular laud the Monzo card – where you can top up your balance, control and track your spending and also it’s pink.
I also liked Daily Budget – the app that calculates how much you need to spend in order to save.
Depressingly little, in case you were wondering.
Keep the big goal in mind
Scrimping and saving is boring. Full stop.
So every time I felt like I just wanted to run into topshop and buy the nearest feathery monstrosity I could lay my hands on I just closed my eyes and thought about half naked men on surf boards.
Le Grande Motivator my friends.
And honestly, every time I see one I think – yep totally worth it.