how do you divide up your pennies?

knuckles1976

Hello,

An idea for saving for car tax that i do is buy £10 post officesavings vouchers which get stuck into a card each month. When its time for your car tax hopefully you will only have to put a little bit towards each six months.

Or if you want to save for a yearly tax maybe buy £20 each month.

Hope this helps a little bit.

Cacran

I am older and greyer. I have relaxed my ways since our kids got jobs, but since we got married 32 years ago (so for 30 years of it) I have been very strict with myself with regards money. That way I managed to have everything I ever wanted. We had 2 wages coming in for the first 9 years then only one wage for 17 years when I got a job as a dinner lady which is only seven hours a week, so have never had mega bucks.

The way I did things........ I got an excersise book and made it up like an address book with each section, instead of the alphabet, as a different thing. i.e. Bills, Mortgage, Holidays, Vets, Food, Bills, Petrol, Car, gifts etc....
I worked out how much I wanted to save weekly for each of these (or monthly depending on how you are paid). When the wage went into the bank, I mentally split it up and entered the amount on the appropriate page. My partner and I took out our spending money, which was totally for our own stuff and was not a great deal. The rest went for saving for, whatever was an unusual expense. Physically, all the money went into one account as the interest was always more that way. Alongside this bank account I would have a current account which I kept topped up with a safe, amount for direct debits, bills etc. I must admit though that direct debits were not my chosen way to pay, preferring to pay when the bill came, but things have changed now.

I was always very strict. If I needed to borrow from one, it was paid back etc. and reviewed the amounts needed on a yearly basis.

I have always bought 'gifts' in advance when I saw a bargain etc. so have always had a special gift cupboard. That saved a lot of money. Christmases were just a case of sorting the stuff out in November ans seeing where I stood.

I have never been in the 'red' in the bank. We have always had at least a couple of holidays a year. Everything we could need in the home. A wardrobe full of stuff ( not averse to second hand things, avid user of Freecycle and charity shops both giving and taking!!!!)
Cars, motorcycles, caravans. My OH just leaves it to me as he knows that , within sensible reason, there is always money in the pot.

As I said before, the past couple of years I have eased up, guess you can say, retired from the rigor of the regime. The kids are working, mortgage paid up, we are very lucky but it has needed working at. I could always revert back if needs be. My children have learned nothing from this, more is the pity but I would like to think that people could realise how less stressful life can be with a plan.

Linda_H_2

HI, I used to have this exact problem, in fact I would lurch from one financial crisis to another with constant overdrafts and problems because I never planned ahead. We had enough money coming in, but I was rubbish at planning. So, I sat down and worked out all of the annual expenses and divided the totals by 12 to get the monthly amount needed to live on generally. I then put the big expenses under different headings (eg car - which included tax, servicing and MOT, entertainment, clothes, holidays, Xmas etc). I then worked out the monthly amount I should save every month in order to meet the upcoming bills for these big expenses. I have an Intelligent Finance online account, and this can be separated into virtual 'jars' online. You just give each 'jar' the appropriate name (eg Xmas) and move the amount needed to save for it by standing order every month. Then, you should always have enough money because you are saving every month. I also kept a running total of expenditure for several months to see if my budgets were realisitic. Two words of caution though - always allow a contingency amount every month and if you start halfway into the year you may need to start the jars off with a big amount to get up to date in time. Eg I started the Xmas pot last JUne, so needed 6 months worth in it already because I only had half a year to save. Hope this helps! Regards, Linda

Jaystar_2

I use the same strategy as Frugal Fox. I put every spare penny I have into a savings account that I manage online. Although all the money is actually lumped together in one place, I keep track of a whole lot of imaginary 'pots' with each 'pot' being dedicated for a particular purpose. I do this by using a spreadsheet that I made using Excel (I didn't realise that there was one on MSE, or I would have used that). Each week I record how much I have added to, or spent from, each 'pot' and the spreadsheet keeps track of the balances.

I also have my Savings Priorities List which has really helps (the old me would have run a mile at the thought, but now I've turned into a budget-nerd). It tells me that, for instance: the first £3 I save each week must be added to my Medical and Dental Pot, the next £5 goes into my Disasters and Catastrophes Pot, the £5 after that goes into my Xmas and Birthdays Pot, the next £20 goes into my Holiday Pot and the £4 after that goes into my Sports Equipment Pot and so on, and so forth. I can change the amounts and and the ranking of the pots but I don't do it willy-nilly and it helps me to focus on what my real priorities are.

I used to think that money was for spending and budgeting was for people that needed to get a life. But, since my light-bulb moment, I'm really much happier. And, in the last year, I have suddenly found that I have the money to spend on things which really mean something to me (my flat, holidays, a new pc) but which I always told myself I couldn't afford because my money seemed to disappear as soon I got it (wasted on magazines and beer and taxis home... things which, in the long run, mean little to me but were very easy to friter money away on).

Cacran

Oh it's so good to hear that there are a lot more out there who do what I do. Doesn't it make life less stressful in the longrun?

earwig

we get paid weekly but pay every monthly so what i do is add up what has to paid each month then times weeky wages by 4 and pay the normal bills like that but there are 5 weeks in some months i call these free weeks we use these weeks for car tax mots servies birthday and christmas

MORPH3US

As with most others, we just put the money aside each month into a different account....

We are both with Nationwide so have our joint account (for house and joint stuff), our individual current accounts (for our own spendign money, petrol etc) and then her high interest savings account is for car costs (£75 a month each) and my high interest savings account is for savings (£100 a month) and any other extra bits of money that need to be put away safe - I just then keep a spreadsheet of whats in that account.

I have always thought having an account with lots of "pots" would be a good idea but never thought a bank would actually do it. It sounds great but can't be bothered with the hassle to change now, especially as I quite like nationwide!

BTW, all the people who save £50 a month or less for car costs, how the hell do you manage that?!? For exampe £40 per month = £480 per year. That would cover my insurance (£200), tax (£115) and then MOT (£40?) leaving about £50 for repairs... 2 new tyres and that £50 is gone, before we even get started on everything else that is likely to go wrong and cost LOTS!!!

M

SarahNeedle1872

MORPH3US wrote: »

BTW, all the people who save £50 a month or less for car costs, how the hell do you manage that?!? For exampe £40 per month = £480 per year. That would cover my insurance (£200), tax (£115) and then MOT (£40?) leaving about £50 for repairs... 2 new tyres and that £50 is gone, before we even get started on everything else that is likely to go wrong and cost LOTS!!!

M

I suspect a lot of people only out £50 or so because that's all they can afford. Those of us that are on a tight budget save as much as we can, I guess because having a bit towards the costs is better than nothing at all. I can afford to save about £60, but I get paid four weekly, so thats £780.

Sarah x

Mr_Gamgee

Hi Dubgirl, Two years ago I developed an excel sheet to help with budgeting which has helped me no end. Now totally debt free, can afford bills when they come through, can see where my money is exactly and am usually a few
steps ahead of the bank statement.

I don't think you need loads of accounts at all, I have just a couple - savings and current (excluding isa's etc), and like frugalfox says just divide it all up on a sheet. Having more accounts would really confuse me!
You've just got to push yourself and roughly one a week or fortnight go through what you've spent. Excel does all the work for me, and keeps a tally of the total bank balance, how much you budgeted, carried from last month, spent so far and how much you have left to spend.

How much you put aside is really dependent on the you. As a general guide I've found that for a single person living alone £20 per month each for gas / elec / water is a good starting point. Look to budget approx £25 per month for car insurance, and about £10 to £20 per month for MOTs and fixing your car if anything should go wrong. I actually only started a 'gifts' pot a few months ago - worked out on average how much I spend on gifts, then how many people I buy gifts for - divided into monthly payments. It surprised me how much you can spend on gifts!

The main thing is to start to budget at least something, and modify it as you go along. If you write everything down and keep to those numbers - be strict with yourself - you should be fine. Dipping into savings is to be discouraged! otherwise there is no point in all the effort (although we've all done it once or twise )

I can email you a copy of my excel sheet if you like. Although its just as simple to do on paper. When you get paid you just have to set aside the right amount for each 'necessity' + savings, then whatever is left is spending money.

SunderlandBlackCat

I use my Smile current account for getting my wages paid in but then transfer everything out except my "pocket money" which covers my clothing, treats & socialising money. Standing orders are set up to transfer set amounts to my Alliance & Leicester current account, Tesco Clubcard Plus account & from next payday, my ISA.

Alliance & Leicester current account I set up for the quidco cashback for my household bills direct debits & mortgage standing order & as it pays 6.5% interest I'm using it to build up my contingency fund as well.

I use my Clubcard plus account for groceries & petrol as paying with this card gets me double points.

Cahoot savings account for just for the quidco cashback car expenses pot & pay matched betting profits into that.

I originally set up a Citibank savings account for the quidco cashback but its now used as my pot for birthdays/christmas etc. This gets my quidco cashback, yougov & any other online money paid into it & I supplement that by using vouchers from other online survey sites & pigsback.