April '07 - PMS Challenge

Queenie

It's that time of the month again ( ) ....

Queenie wrote:

This is our "Pin Money Savings Challenge" - a very old style way of money 'saving'. The old adage: "Take care of the pennies and the pounds will take care of themselves" is as true today as ever it's been and so has the old style idea of "Pin Money" (tucking away pennies to buy the odd luxury - in reality, that pin money literally saved the day when families lived payday to payday or the breadwinner was made redundant!)

Once you've set up your budgets (here's Martins article on the basics of budgeting for those who may not have done so yet) you'll know where you're at with your income/outgoings.
Some of you will already have earmarked amounts to tackle your debt problems (if you have them. Here is Martins article on Problem Debts) and some of you may even have set up regular savings.(Martins article on Starting Saving)

There's a danger that those "savings" are being swallowed up elsewhere and never really knowing just how beneficial those nips and tucks have been in reality or benefitting from them. This is pin money and we should know how much we're accumilating; We should be able to tap into that money and benefit from it; we've earned it by making cost cutting choices!

First, choose a goal. Think about what you want to save for. Maybe it's something relatively small that would actually help you to save more money in the future.

For example: I used some Tesco vouchers in January which saved me £28 on my monthly shopping bill - at the till I got that £28 via cashback and then I bought a breadmaker in another shop which was on sale. The breadmaker is saving me money as I don't go to the shops as often to pick up a loaf and end up tempted into buying extra's while I'm there plus it saves on petrol through less trips.

Maybe you wish for something larger - a family holiday? A dishwasher? A newer car? These items may take longer to save up for, but they are still attainable.

Where is your pin money coming from? A variety of ways ...

Coupons/Vouchers: You can't bank on coupons when you draw up your household budget, so view them as bonus'.
If you normally spent £50 per week on groceries and that week you have coupons which reduce your bill by x amount, that x amount becomes your pin money savings. Put the same value of the coupons into your pin money.

Bogof's: If it's on your usual shopping list and you are able to get it on bogof - put the cash value of the saving into your pin money.

Freebies: I've put some of these into my gift box store; I can't bank on freebies to provide my gift needs (gift purchases are accounted for in my budget planning already) so they are also bonus' - so, the cash equivalent can go to your pin money.

The monthly food challenge:
Take a look through the Storecupboard Challenge and/or the Monthly Grocery Challenge. If you find your food bill reducing, put that extra into your pin money.

Tips from here: Cleaning: E.g. Vinegar as a fabric softener; if you stop buying fabric softener, work out the saving (you'll need to deduct the cost of the vinegar you are replacing it with) and put that amount into your pin money.

Make it from Scratch: Look through the recipe collection and see if you can make it/bake it cheaper.

Research your purchases! - before you buy anything have a look through the Shop but Don't Dropand Quick Grabbit While You Canforums to see if you can get it cheaper (utilise the "search" facility within those forums too). If all else fails, try posting in I Wanna Buy-It, Do-It forum, someone else may know of the best deal on what you're looking for.

At the end of each month, empty out your pin money and transfer that to a savings account (this way it can now begin to earn a bit of interest = more pin money! )
The start of the next month, you will know how much you've shaved off your basic grocery bill (this applies to the food/fabric softener example, not those unbankable freebies/bogof's/coupons) so begin by putting that into your pin money.

Each month we can post what we have saved money on and added to our pin money.

What if things are soooooo tight that every saving you make each week can't be put away because it's needed elsewhere?

Not a problem, you can still keep a record but instead of cash this will be your "virtual" savings. It will be very encouraging to see how much you are "saving" by making small changes, even if you can't put away the actual cash.

Some of you have already absorbed these savings into your budget and recalculated accordingly, that's ok, this challenge still applies because any new ideas/tips that you pick up can now be utilised for your pin money.

Clarification of Virtual Savings

Let me give you an example:

Suppose I've worked out my budget and menu plan for the week and one of the items, I know, will cost me, say, £1.99. Off I go with my list. When I'm at the store, I find a pack of something else, reduced to £1.99 instead of the usual £2.99. So, I snap it up!

I have made a saving of £1

However, I didn't *have* £2.99 in the first place; therefore I would never have bought it. I could *only* buy it, because it was the same price that I had available to spend. (The original £1.99). In reality, I haven't saved any hard cash. But that doesn't mean I haven't saved. That is where *virtual* savings come into play.

By simply snapping up a bargain and not spending anymore than I usually do, I've bought something a little better that I couldn't normally afford.

I don't want to lose sight of the fact that I've saved that £1 by being more shopping savvy.

So, I record it as a *virtual* saving ...
... not *real hard cash* but a saving nonetheless.

The term, *virtual* saving, is a bit like "virtual reality" LOL

It can be quite demoralising if, week after week, some of our MSE'er are really working at pinching those pennies and squeezing those pounds - this way, at the end of the year, they can still see that - hey, it's working!

Now, should I find my budgeted £1.99 item reduced to 99p THEN I have £1 in cold hard cash that can be put away into the pin money savings.

I hope that makes it a bit clearer. If not, don't hesitate to ask any more questions

Jump in, if you haven't already, and start clocking up your PMS!!!

fizzel81

ummm this looks like something i should have a go at, silly question but something you used to buy each month but no longer have to would/could that be classed as pms (sorry dumb question i know)

Queenie

No such thing as a dumb question and welcome to our PMS challenge

To answer: yes, if you have now found a way to "save" that expense, you have earned that value in PMS Well done to you, too!!!

fizzel81

great, thats a good 30.00 plus per child per month ohhh 60.00
(already been putting nappy money aside have 79.75 in a jar on telly)

Queenie

Wow, that is GREAT, fizzel!! :T :T :T :T

Now, have a think and decide what you are going to put those wonderful savings towards

Tip: Take the jar off the top of your TV - t.e.m.p.t.a.t.i.o.n.!!! and go put it in an ISA so it can also earn you some yummy, scrummy FREE money in the context of interest!!!

If you keep it in the jar on the TV, you are almost using it like a comfort blanket - ie: well, it's there just in case I need to dip into it. The danger is, just like "Bill", " Justin Case" will gobble up your endeavours and you'll not see the real benefit of your hard earned savings.

Locked up in a bank, it's not quite so easy to dip into and, as stated previously, it can be *earning* you money at the same time

You've earned it, now let it work FOR you! :T :T :T

Eels100

Ok, I'm in. I have piggy banks and tins all over the house full of coppers, but perhaps a little more structure would help. Also, right now we're saving like maniacs for the arrival of first baby this summer, so seeing how little we've really got to spend I'm amazed how much we've been wasting! Obviously having less money means there are more things I want.

Consequently, when I spotted an article today which said dishwashers are eco-friendly because they use less water I was really excited ... but the £500 + plumber costs to get a decent one seems totally unattainable.

THEN I read this thread and thought maybe I should have a go. How do you guys record/manage these things? My problem is that if it requires any maintenance I'm so lazy I lose track. Although I guess the fact that each month on payday even if I only have 50p left in my current account I transfer it to a savings account must be worth some brownie points!

fizzel81

Queenie, it will all be going towards carpets and a cooker for when i get re-housed, been spoilt up untill now living in army housing has meant no cooker,curtains or carpets to buy everything i get and dont need to spend is going to an e-savings account ive just set up

scuzz

On going pot now stands at £430:j Good luck everyone

Maisie_M

Joined in the Grocery challenge this month so this would seem to go hand in hand with that. Have an empty piggy tin (given to me at Xmas with a mug in so I will use that for my 'real' savings and a spreadsheet for my virtual ones.

Fingers crossed how it goes - will save for a year - may open a savings account to put the money into each month - and then decide what to spend it on when I see how much I have saved.

lil_me

Good luck everyone. My PMS savings are now a 4 figure sum which I am putting away for our holiday and days out etc over the summer this year. This is all from PMS savings, spending less than half what I used to on groceries etc has helped of course

Oh and I have saved any £2 coins and silver change seperately aswell, so will be all that to tot up soon £2 coin tin almost full.

jo101_2

Hi

I am going to give this a go this month, I have half heartedly tried before on my own, but have lost track part way through the month. My pin money saved will go towards our summer camping fund so that we can have some family weekends away this year.

I am going to open an account to put this money into as if I have it in the house it tends to get raided in emergencies.

Jo