Saving is a simple concept

Bring in more money then you spend. Well done… your saving money.

The hard part is putting that into action and holding part of that money for a long period. Especially as a teenager. I see my emergency fund or investments and want to spend it. You’re not alone, so here are a few tips from me and a special guest.

First things first. Budget and emergency fund.

I talk about creating an emergency fund a lot. How is it that we can keep that money for something spending it on something big? How do we even get it started, as we all know that can be the hardest part. This is where this article comes in.

A budget and goals are something we can all use to help us in our saving aims.

A quality budget does a range of things. I’ll be posting a blog post later on budgets: the good and the bad. My special guest goes into more debt later on in the post, so I’ll skip over it now but stay tuned for it.

The basic principle is to keep your expenses below your income and invest/save the difference. I suggest to people aim for a minimum of a saving of 5% before tackling anything more significant.

To calculate this is quite simple. Check your income, take away the expenses. Take the expenses from the income and find the percentage (Percent Decrease (% Decrease) = (Decrease in Value/Original Value) x 100)

If that doesn’t work for you, click here or do a google search on how to find a percentage.

Just taking the time to look at your expenses can save you money. You might find a monthly subscription coming out that you no longer use. See how much your phone bill is genuinely costing you and so much more.

Don’t worry if you don’t get to 5% yet. Have that as a goal and build from there. We all have to start somewhere.

Invest into money making assets and save that.

This is about saving so I don’t want to go into income deeply here as it’s an article on saving.

Just start thinking about Dividend stocks and other forms of ‘passive’ income as you don’t need or rely on it. This way can become a more comfortable way to save.

I have personally been investing this way and be able to reinvest every penny of it because I don’t rely on that source of income. Resulting in being able to save more money than last month.

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Photo by Micheile Henderson on Unsplash

Ask yourself if you need it or could it be improved or could you save money on it.

That £100-£200 Phone bill is a large amount of money coming out of your account each month. Can you get the same or similar deal for a lower price?

That sky subscription is costing you a lot. Do you use it enough or could freeview be for you. I had it growing up and it did have some content on it.

My point is to check your bills at this point. Do you find that you spent a lot on eating out or takeaway food? Is that worth it to you or would you like to start cooking 1-2 hours a week to cook to reduce that number?

I did this and I found out that I was eating healthier and saving money. It’s a win, win.

Usually by this time you get to this stage your saving around 10%.

Set Goals on the money saved

It’s all great your saving money now but how do you expect to be able to keep this up

Motivation might run out. You don’t see any immediate rewards. I talk more about this in my ‘how to inv3st £1,000‘ post so I’ll brush over it here.

It would be best if you had a reward for doing something good. It can be as small as getting Ice cream or something else that’s small, as long as you relate it to saving.

It’s all good if motivation pushes you now but what happens when it stops or decreases? That particular reward pushes you back into it.

To give you a personal example, I try to work out every day but I don’t always feel like it. The days that I fail, I don’t get desert. I use desert as a reward system, and as a result, I found that I do it almost daily. Find something you can implement as your reward system.

I also suggest to set big goals, like going on a holiday, ticking stuff off your bucket list, a new phone you want. Saving money becomes much easier!

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Photo by Sandy Millar on Unsplash

The MadWife had something very interesting to add.

I really think you can’t mention saving money without mentioning budgets first. Savings are an essential part of budgeting. A budget needs to cover essentials like:

* Housing

* Transport

* Food

* Utilities

* Insurance

* Healthcare

* Savings, investments and debt payments.

No one would stick to a budget if there were no allowances for fun. A budget also needs to include:

Personal spending.

For treats like new clothing, hair and beauty (Keep this relatively low).


can cover the cost of dining out or going to the cinema. Savings need to be a core part of a budget. Ideally, you should save at least 20% of your income. As a bare minimum 10% should be saved. You need savings for many short and long term financial goals. Savings should include:

An emergency fund

to cover unexpected financial disasters. Ideally, you should save at least 3-6 months of expenses to cover this. An emergency fund might be needed in case of a job loss or illness.

Sinking funds.

These enable you to budget and save for costly events throughout the year. Sinking funds cover things like paying for a vacation of Christmas.

Long term goals.

This category includes saving for replacement large appliances, saving for children’s education and retirement savings. There are many lists on the internet about frugal, thrifty living. The internet also has a lot of information on generating extra income. Managing money well boils down not only to knowledge but behaviour and habits. Without the right attitude and habits, a person can never out-earn frivolous spending patterns. Despite what the internet tells you cutting out your daily coffee is not going to solve money problems. Saving and managing money well requires an appreciation of what really matters in life.

Prioritise knowledge and education, family, experiences and travel. You can look to the largest expenses in your budget to save money. Forget about the Joneses, you don’t need to impress anyone, only to love yourself and be loved by those closest to you. Some of the wealthiest and most successful people shun extravagance and live a modest lifestyle. Budget areas where savings can be made are:


Your house and mortgage are a liability. It is not adding money to your pocket. One of the best pieces of advice I’ve been given was to live in the smallest house you can cope with. Unless you are earning income from a house it is a liability. There is potential for depreciation. The surplus money from downsizing can be better invested elsewhere.


Spend as little money on transport as possible. It is much healthier for you and the environment to cycle or walk than drive. Buying a new car or leasing a car is a huge expense, that leaves you driving around in a depreciating asset. If you really need a car, buy an older car that you can afford to buy with cash. This means you are not shelling out money on a monthly payment to the bank.

Save money on food by doing these things:

* Learn to cook.

Eating home-cooked food is healthy and cheap.

* Buy unpackaged, unprocessed foods.

If your grandparents weren’t eating food regularly it should not be a regular part of your diet. Basic staple foods are the way to go. Packaged processed foods are expensive and unnecessary.

* Skip big branded products.

Buy the shop own brand where possible.

* There is logic in the saying hunt high and low.

Don’t fall for marketing tactics of placing expensive products in your eye line. Look at the top and bottom of displays to find cheaper products.

* Utilities and insurance are costly.

Never auto-renew. Always shop around for better deals and discounts.

* Health and medical expenses.

Our health and body are one of our most valuable assets. It is important to lead a healthy lifestyle to lower insurance expenses. As well as saving money on insurance making even small changes to our health and fitness routines helps us to enjoy our lives with our families for as long as possible.

Finally automate your savings. This can make it a lot easier.

She writes about personal finance topics and ways to generate extra income. I have read many of her Blog posts (Include an in-depth look at saving) and found them to be very insightful. If you haven’t already, go check her out


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This Post Has 2 Comments

  1. Ruth Graham

    Awesome post. It’s never too early to pave the way to financial independence. The right habits and mindset are so important in preparing for the future.

    1. 1rishpher0

      Thanks for your contribution!

      A very important conversation to have.

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