Money Matters: Evaluation Analyst Trying To Save & Curb Shopping Habit

Welcome to Money Matters: GLAMOUR’s new weekly dive into the world of finance – your finance. These uncertain times have reminded us just how much understanding our money matters and yet… how little we talk about it and how much it’s shrouded in secrecy.This stops now. Keen to break that money taboo, we’re chatting all things personal finance from daily budgets to ISAs and pensions. Each week, a woman in a unique situation will give us an honest breakdown of her finances, and our expert will tell her easy tips on exactly how to tackle it. So, grab a cuppa, take a seat, and let’s talk about money…

I’m a cabin crew member on £20k a year and got furloughed in the pandemic. How do I future-proof my finances?

Zara* is a 22 years old Evaluation Analyst living in Leeds with her parents. This is her money month…

In June 2019 I finished University, and I went straight into a job. I commuted to Manchester but I left as I was spending too much money on transport and the commute took way too long. Now I have a job in Leeds, currently working from home due to COVID, even if I had to travel to work I have a free transport card which is great.

My experience with money isn’t too great, once I started University I always spent my student loan money pretty quick, and once I finally got a job I wanted to save, which I have been struggling to do, I am a self proclaimed shopaholic, always buying things I don’t need and never sticking to my budget. Recently, I have saved a bit, especially now that I have a side business, but I feel like I can do better, just need advice on how to do it properly.

MY ACCOUNTS

Current account: £1,805 (of which £500 is what I call ‘my savings’ as I don’t actually have a savings account, all my money is in one place.Savings account: Don’t have one.Business account: £3,500

This government ‘skills assessment test’ that reveals your perfect job is going viral, so was it spot on for you?

MY INCOMINGS

Monthly wage: £2,579 (pre tax) £2,041 (post-tax)

Monthly wage post-COVID: Same

Any other incoming payments: Around £2,500 per month (post-tax and expenses) from Etsy Business that I started during lockdown, this money is only used in emergencies, but I am trying to save all that money for a deposit for a house.

MY OUTGOINGS

Rent: £100

Bills: £105 (Netflix, Phone, Apple Music).

Other: Credit Card (amount varies) this month I paid in £500 – I am trying to pay it off as soon as possible as 0% interest rate finishes at the end of December.

Splurges: £500 on shopping ( I got some boots for winter, some clothes as I have decided to create a capsule wardrobe); £100 – on going out for food; I treated myself to a designer ring that cost £250; the rest of the money is just spent on food for home, going out to Starbucks, basically spent on unnecessary things on my visit to the supermarket.

Weekly budget: I give myself a budget of £100 per week but always over spend!

What I spent this month: £1,106 plus £1,000 on a dentist.

MY DEBTS

Credit Card debt: £2,896.

Student loan: I am paying my student loan back at £35 per month, I actually don’t know the full sum I owe.

MY MONEY MOOD

What I want to save for: I want to have an emergency fund in case anything happens.I would also like to save for a house, I was hoping to move out within the next 2 years but I am unsure if I will save up for a deposit in this short amount of time, I don’t want to rent. I also would like to save for a nice holiday.

How I want to plan my money for the future (pensions/ investments etc): I have opted out of pension at work for three years, I will probably join again after the three year period is up. I would like to invest, but I’m a bit unsure how to go about that.

My worst money habit: Overspending my budget, I keep spending too much money on things I don’t need.

My biggest money worry: Not knowing how to save properly, I keep overspending my budget, and I want to have quite a bit of money behind me.

Current money mood: 🤷🏼🙂🤹🏼

I’m a sales rep taking home £1,855 a month plus commissions – how much would I need to save to retire early and buy a place?

WHAT THE EXPERT SAYS

Break it down: It’s harder than ever to be ‘good with money’. Retailers are geniuses at getting our attention and cash and as we ride out these uncertain times, shopping under the guise of ‘#self-care’ can easily become that emotional fix we’re all in need of. Rather than getting swept up in the flurry of insta-marketing, take a moment to see where your money is actually going. Break down your non-essential buys from the last 3 months into three categories: 🚫 big regret, 🙈 could do without and 👍 no regrets. Now look for patterns. Tend to blow your budget on payday? Impulse purchases when you’re feeling low or stressed at work? Do some digging and try to identify what’s really going on.

Hack the system: Next, it’s time to hack the system and take back some control! Unsubscribe from marketing emails, download website ‘blocker’ apps like Leechblock, Freedom and StayFocused and remove your credit card details from your browser. When you’re feeling tempted, take a second to think about how many hours you had to work to pay for that item. Is it really worth that much? Yes? Go for it! No? Think again.

Prioritise your goals: You know what you want, but without a clear plan of action, those cheeky purchases quickly eat into your income, making it hard to save. Instead, shift your mindset – making your goals (paying off debt and saving) your number one priority. As soon as you get paid, or take money from your business, put your goals first! No ifs no buts. It makes sense to pay off debt before investing so work out exactly how much you need to be setting aside every month to get debt-free before your interest rate spikes in December.

The E.F: Once you’ve got that figure in mind, focus on your emergency fund. As a rule of thumb, you want to have around 6 months worth of living expenses in the bank – tricky if you’re renting but if living with your parents if an option for the foreseeable future then that should be achievable. If you can save for your E.F whilst also meeting your debt-free goal, go for it, but if it feels unrealistic, I’d focus on wiping that debt first.

The budget is broken: If you’re consistently breaking the budget, then the budget is broken. By the sounds of it, you’re underestimating the big one-off costs and overdoing the impulsive purchases (we’ve all been there!). A budgeting strategy that works is the adapted 50:30:20 model. In short, break down your spending into needs, wants and goals, setting *realistic* monthly targets for each category. You’ve already got part of your ‘goals’ budget sussed by working through points 3 & 4 but importantly – you also need to account for those expensive one-off items that come up every so often (a new laptop, trips to the dentist, the dream holiday etc.) Think about what you’ll be buying in the next year and work backwards – how much do you need to put away? For more help with saving and paying off debt, you might find this debt-free story helpful.

Alice Tapper is the author and founder of Go Fund Yourself. *Name has been changed. Join GLAMOUR’s new Facebook group, Money Matters, for more exclusive finance content.

Love our Money Matters column? Feel worried about your finances? Or just want some expert help on how to achieve your financial goals? Get in touch with us at [email protected] to submit your own money diary to gain access to our expert-led advice, tailored to your finances! These submissions can be anonymous or not!

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