Some statistic somewhere (TBH, my dad told me, with the incredulous tone of someone who couldn’t believe what he was saying) claims that 64% of Americans can’t come up with $1000 in an emergency. I’m not saying this so we can all point and laugh at American’s – I’m pretty sure it’s a similar figure over here in the UK – merely to highlight that saving money is much more to do with mindset and intentional spending than it is to with income. For people with super low incomes though, it may hard to work out how to start saving money at all, never mind £1000 (I know £1000 isn’t the same as $1000 but it’s a nice round figure).
The reason my dad was so shocked was that he would never have allowed his savings to get so low (apart from right after an emergency I assume) and my parents have always been self-employed in a fairly fickle niche(he’s an artist, my mum does…all the rest from the bookkeeping to the website), so it’s not like they ever had a tonne of money to spare.
I’m fairly proud that I’m able to unequivocally say, hand on heart, that I could come up with a grand if required. Ok, so that would almost clear me out and we’re aiming to save a lot more, but it’s been one of those times when we’re forever spending money. However, when my laptop died it was nice to be able to buy a MacBook Pro that would last me a while whilst being super fast and negates the need for a laptop.
This time two years ago, though, the idea of having a thousand pounds was laughable. I just didn’t earn enough. I always felt like I was having to dip into my overdraft. I didn’t have enough money to buy the things I wanted, and I’m not exactly high maintenance (I have, in my entire life, had two professional manicures, one facial and one massage).
So what changed?
If you’ve heard this before, I apologise, but my boyfriend lost his job. On Christmas Day. Wooo. I made enough to just about cover our joint account bills, but he still had payments to make on a ridiculous phone bill (it covered our iPads as well as his phone) as well as a car loan and a couple of ancient credit cards.
We were lucky that he’d worked at the company for a long time so he got some redundancy, which we used to pay off the car loan. The rest he put in the joint account as a buffer for a few months. He got a job in the beginning of March, but January and February were…slim to say the least.
It was the wake-up call we needed. Sure, we were in low-income jobs (Dave’s new job earned him significantly less than his previous one, but it allowed him to stop working nights, which was worth it to us), but we didn’t spend frivolously. Neither of us are party animals, we don’t smoke, we don’t have expensive hobbies and we eat out about once a month. WHERE WAS OUR MONEY GOING?
We needed a budget
My budget is super simple (read about it here), but once I got it implemented, I was in business. Now I save almost half my income every week (obviously some goes towards things like my laptop and Christmas, but it beats being spent on random crap that I cannot account for).
It may be that you can’t save anywhere near that much, but that ok. Just realise that you can save something. I highly recommend setting up a savings account (I use an ISA) and setting up an automatic transfer every time you get paid. I also have a piggy bank at home for my loose change. Laugh all you want but last time I cashed it in there was £124 in there after about three months. That’s my car tax paid for. I also have one of those tins that you need a tin opener to open for any notes. If you work somewhere where you get tips, this is a great option for saving them. I’d recommend writing down somewhere how much you put in, though, because eventually the suspense of not knowing how much you have will break you and you’ll open it. Trust me, I’ve been there.
Ok, so you don’t think you can save any money. Here are some ideas you might not have thought of:
I work in a job where my weekly hours fluctuate. If you do too, any week where you work significantly more hours, save the extra. Don’t be tempted to reward yourself for a hard week with anything more than a hot bath and a bottle of wine. Since I’m always working extra hours, I set my weekly automatic savings amount to slightly more than what my basic wage covers, so the extra money fills up my overdraft. This may seem counterintuitive, but here’s my reasoning.
Say you budget £50 a week for your groceries, but you only spend £49. Save the £1. It may not seem worth it, but if you do that every week you’ll have saved £50 with no effort. Spend that £50 on your stockpile.
This is a bit of a grandma trick, but it works. Just refuse to spend a certain coin. £2 coins seem to be most popular, but I find 50ps easier to come across, and have the least impact on my life. Just save your 50ps. Don’t spend ’em. Pop them in your piggy bank or tin. If you’re using a piggy bank, don’t save £1 or £2 because it’s perfectly acceptable to buy £10 worth of stuff with them, but if you roll up to the supermarket with 20 50ps, you should (if you have any self-awareness at all) be too embarrassed to spend them.
I hope I’ve convinced you that however poor you are, you can still save something, even if you just save every penny you pick up off the ground. If anything, it’s a habit worth getting into, so if you get a pay-rise or a higher paying job you’ll be more used to saving. The problem with starting to save money is that you often don’t do it until you’re forced to (like I was), but trust me, it brings a feeling of security that you can’t buy.
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