Whats your spend / save balance like?

Pepperoni

What the title says really.

We COULD save X but it would mean really cutting down on meals out, clothes, etc etc...

Just trying to decide what a medium balance is. Whilst I don't want to waste cash and would like to push ourselves to save as much as possible, my husband doesn't want to live on a tight budget and have to penny watch all the time.

peachyprice

Our absolute minimum is £250 per month, that's included in our budget and goes straight to savings, it equates to about 8% of our income.

Any extra income like overtime or bonuses goes into savings unless there's anything we particularly want to buy.

We also use our savings as a kind of loan facility, if there's something big we want we buy it out of the savings then increase the amount we pay in every month until it's paid off.

We could probably save a fair bit more, but we both work hard for our money and prefer a sensible balance between saving and still doing nice things.

FairyPrincessk

Last year we saved around 25% of the money we actually take home (so that is after pension contributions/student loan payments). Some of that was then used for a holiday. That said, we don't have children, although we don't live in the cheapest area it isn't the most expensive or anywhere near London/the South, and we're saving for a house. If those three things were different then our balance might be different.

maman

There's little point in saving just for the sake of it provided you have a buffer to cover any unforeseen expenses like broken appliances, car repairs or perhaps redundancy. I've heard figures like 3 months salary out aside but others might comment on that.


What you need to ask yourself OP is what are you saving for? Do you have any debts? Do you own your own home or do you need to save for a deposit? If you have a mortgage can you overpay to reduce the term? Might you have a lower income in the future because of perhaps maternity leave? Do you have enough for holidays when they come round? What happens when your car gets older, can you replace it?


It's easy to spend all disposable income by living for today but what about tomorrow? Do you have any plans for the future?

buzzyzoe

I overpay my mortgage each month which I count as 'savings'. I'm overpaying about 50% of my take home pay each month at the moment. I want to do this hard for 3-5 years and hopefully get rid of the mortgage altogether! I'm pretty disciplined though and have reduced all my outgoings to much lower than they've ever been before.

WantToBeSE

I save a certain % of my sons disability money for him for when he is older, as we worry that he won't be able to get a job and disability benefits are not guaranteed.

Apart from that, everything that's left over after bills gets put towards debt. I'll be DF next year, and then I'll put the same amount into savings until I have a nice healthy sum in my bank account!

moneyistooshorttomention

I have always taken the view that income is first and foremost for living on (ie bills, then money for me personally). After that - I've always taken the view that whatever money I get over and above regular income will go towards whatever is next on The List (ie get a house/do work on house/get savings - that type of thing).

So the first large lump sum of money over and above normal income that I got was used to buy my starter house. The next one was used to pay off much of the mortgage on that starter house. Subsequent smaller ones were used to pay off as much as I could of the balance of that mortgage. If the Extra Income lump sums were noticeable (ie up in 3 figures - the hundreds of £s or more) then I would buy myself a little present of something I wanted personally for having made the effort of getting that bit of Extra Income iyswim and then use the largest part of those lump sums for whatever was next on The List. I'm human - so I thought/think it's reasonable to "reward myself for effort" for whatever money I manage to get over and above basic normal income:rotfl:. That tended to translate into = I've just got £1,000 Extra Income and so I will use £100 of it to buy myself a little personal reward for effort (eg a bit of nice jewellery) and the other 90% will go towards The List.

I'm now in my 60s and still not financially straight yet:( (ie around £70,000 away from it:eek::mad::eek:) - with things like quite a bit of work still needing doing on the house and some more savings to get. At my age - I have dug my heels in and won't be economising any longer to get that money. I've got about 20 years to go (presumably???) and have decided I'm now too old to economise for the sake of The Future.

Hence I spend whatever I think is reasonable to spend for someone in my agegroup by now - and there is a bit of income left over after that. Whatever other money I get over and above what I require to live on (at a reasonable standard of living and allowing for being in that agegroup - ie no economising any longer) is put towards The List.

So - at some point right now - I've accummulated enough spare income for the next thing on The List and will be starting the process of getting it (ie the next bit of work on my house then).

I guess that's the basic thing imo - there does come an age where one is simply going to "dig heels in" and literally refuse to economise any longer. What's the point - when there is only x years to go (presumably)?

spadoosh

Unless we're saving for something specific its ad hoc. If we want something we will cut down on the luxuries and concentrate on saving.

No hard fast rule.

Keep a minimum of 3 months expense in savings, and have been saving for a wedding but not missing out too much. We're not frivolous people really so dont have to spend all the money we earn each month, sometimes we will be left with nothing from the previous months income sometimes we wont spend a penny beyond the 'essentials' (bills, food, work related costs etc).

Its rare we'll impulse buy and if we do its small items.

Lynplatinum

Hiya

After living expenses - I have a food and essentials budget and a Happy Stash budget (as suggested by Jackie O). Anything left over is saved.

Any 'windfall' money is split into 3. One third for 'Big' savings - this is mortgage/ house purchase/ in case some thing horrible happens - I always aim this to be at between 3 months to 6 months of salary (when I was made redundant and waiting for my business to take off it was very useful and I extended a three month salary saving to 6 months). One third for wanted things of medium size ( a car/ washing machine/ holiday/ special birthday). And one third to blow exactly as I liked.

I consider it very foolish to not have any savings at all - the assumption that the government will provide as we get older/retire or even will continue to have medical treatments available for free - is erroneous. All major Economists agree that there are not enough young people earning sufficient to pay taxes such that the following generations of old folk will be able to be supported - even as (much/little) as they are now :eek: How they propose to tackle this varies widely!

But I hope that by being prudent not just frugal I can live to a reasonable standard.

So still treat yourself a bit! :beer:

pennystretcher

Have you watched "Eat well for less" on BBC? Some really good ideas in there how to cut down on your food bills..

theoretica

I average about 35% into long term savings (not spent the year I earn it), more if you count the pension which goes out of my pay before I see it. I find it very easy to save on a monthly basis as I value a few big spends much more than lots of smaller ones. The question is whether I spend those savings on things like holidays and gadgets or save them for retirement or moving house.