I’ve always been pretty good at managing my money (thanks for that skill Dad!) so although I’ve been off from work for almost a year I’ve managed to cope without running up heaps of debt. Obviously this in part is due to moving back home to my parents following the end of my relationship- there’s no way I could have kept the flat on myself, or moved in to another no matter how much I loved it. I’ve always been very fortunate that financial help from my family has been available to me. But it would have been all too easy to bury my head in the sand and continue spending like I was on a full time wage. As it stands I’ve still managed to build up a modest amount of savings whilst still living a life so I thought that today I’d share some of the little ways in which I manage my money.
1.: Alongside my main current account I have several other accounts that have all been given a specific role. One of these is for buying gifts, another is to fund a social life and another is my savings. Whenever I find myself with a bit of extra cash- any income generated from my blog for example the first thing I do is divide it up- a portion gets put away for end of year tax return (so I’m not left having to find a big chunk of money), and I also add a bit to each of these accounts so I’m constantly building up resources so I can accept a coffee invitation or pick up a birthday present without needing to dip in to my current account funds.
2.: For my day to day spending I use cash, my debit card rarely gets used in a shop. It’s far easier to face up to an empty purse than it is to keep a regular eye on your bank account and once my weekly “allowance” is gone it’s gone and I have to put serious thought in to whether I withdraw a bit extra to tide me over. If I don’t carry cash it because far too easy to fall in to the “oh I’ll just pay for that diet coke and magazine on my card” mindset- a quick swipe of the plastic doesn’t feel like spending money and it quickly adds up.
3.: Every pay day I put aside a certain amount of cash for shopping trips- usually £50 per month and this pays for my bi-monthly shopping trip with mum and funds a few purchases in Monki along the way. I find that by doing this I a) have something to look forward to and b) don’t tend to buy clothes outside of these trips because I know the next one isn’t too far away.
4.: If I do want something outside of these shopping trips I try and sell something on e-Bay first to fund it. This has the added bonus of a “one in, one out” effect on my wardrobe and makes me address my hoarding tendencies!
5.: I like to treat myself as much as the next person but before making a purchase I do force myself to think long and hard about whether I really want/need it or if I’m just caught up in an “ooh, shiny” moment. As I’m fortunate enough to make some money through my blog I tend to use what I haven’t filtered off in to my bank accounts to fund these purchases and often find that by the time I’ve amassed enough to make a purchase I’ve realised that it was more of a whim and stopped myself from making an impulse buy of something I’d later regret.
It might sound pretty boring and rigid but I’m convinced that this is what has helped me through the last year and being forced to be more mindful of my money means that when I am back earning my full wage through work (first day back today, woo!) I’m fairly confident that although I’ll be feeling flush I’ll make sensible decisions and focus on re-building my savings rather than splurging as soon as it hits my account. Of course I won’t deny myself and there will be treats along the way but with wanting to move out again as soon as my health and finances allow I have more reason to save than ever.
Although I’ve managed to keep myself afloat it’s good to know that had it have been needed a short term loan from a reputable company such as Cash Lady would have been a short-term solution. I’m not suggesting, or advocating this kind of loan as any kind of solution, but in an emergency it’s reassuring to know that there is a regulated website out there to bridge the gap.
I’d love to know the little ways in which you manage your money, or if any of my habits have helped…leave it all in the comments below!
It’s a very disciplined structure for managing money and it works, which is the most important point! Many people just cannot budget or manage – I have a ‘just in case of emergency’ ISA set up. I do love online banking though for its ease and transparency. You know, Germany is very distrustful of card purchases in general. Here in Bavaria, cash is king and many small places accept no cards at all! I’ve had to get used to carrying money with me as in the UK I almost exclusively used my card. Thankfully I’m good at keeping a running total in my head of the days spending and knowing what’s left in my bank.
Interesting post. I’m so glad your blog has been giving you a bit if income in order to help during the time you’ve been off.