Saving for my life!

edited 18 October 2017 at 9:16PM in How much have you saved?
9 replies 3.8K views
UnknownSammUnknownSamm Forumite
7 Posts
edited 18 October 2017 at 9:16PM in How much have you saved?
Hello,

I have only discovered this site a week ago, thanks to my line of work, and have intended on posting on here for a while but never actually got round to doing so. I figured this would definitely help me and keep me motivated now it's out in the open :)

I am 18 years old, and I have just started an apprenticeship in the financial sector, after finishing college, and currently earn minimum apprenticeship wage which is around £6.5-7k a year. The apprenticeship itself is only a year but after I will hopefully receive a permanent position starting at £16K so I am not too worried about the low wage, especially considering i'm living at home and being so young.

I have made a really stupid mistake by taking out a very high interest credit card and racking up £450... a lot of it was to help pay a bill which could have left us with no electricity if it was left unpaid which my family couldn't afford, the rest was to pay for interview clothes and bus pass to actually get to work. I am working on clearing this within the next 6-7 months and have stopped any further payments on it and will never take out a high interest credit card again! I guess I have learnt the hard way...

One of the main things I want to do is start a savings account. I didn't have an account set up for me like a lot of children and whilst my mates have £1000s to their name in their savings, I have virtually £0 to my name. However, it is never too late to start so this is the beginning of my savings journey!

I am hoping to have three savings accounts (I know, it's a lot!)

Account #1: Emergency/Safety Funds

This account will be my safety pot in the event I lose income for any reason, such as losing my job or having unpaid sick leave and I am virtually left with no money. I won't touch this account for any other purpose. As I am currently living with my mum, and I am in a good position with my apprenticeship with management already making plans for me being made permanent, I hopefully won't need to touch this account in the near future.

Goal: £5,000 (this will cover me for at least 6 months, assuming I have moved out with expenses of £800 a month max)

Account #2: Rent/Mortgage Deposits

This account will be used mainly for housing deposits. When I first move out, I will more or less likely rent and therefore my first goal for this account is to save enough for the deposit which is usually 4-6 weeks worth of rent. The remaining money and all future deposits after this in the account will be put towards a deposit for a mortgage, which is goal two. My goal is to take out a mortgage and own a house by the age of 25 (six years and a couple of months into the future).

Goal #1: £1,000
Goal #2: £10,000

Account #3: Rainy Day

In case I break or lose something and need to pay for repairs and replacements, or slightly going over budget and need a little bit of change to pay for lunch without having to take out credit. Pretty self explanatory.

Goal: £1,000

In terms of the goal themselves, those are mainly guidelines. If I reach a goal, I will keep adding to it as the more money I can save, the more security I will have. If, for example, I take out a mortgage and still have money left in that account, I can either split it between the other two accounts or use it towards the mortgage or treat myself to a night out... Basically i'm not stopping at the target amount!

If you have any suggestions or comments, please feel free to share! I am only 18 and don't want to rely on my parents to hold my hand through life which is why i'm trying to take it into my own hands which means mistakes will be made so any feedback or advice is greatly appreciated!

Thank you!

Replies

  • nyc_451nyc_451 Forumite
    502 Posts
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    Hello and welcome :) Well done for starting so young and I wish you all the best in saving.

    May I ask if you have drafted a budget for yourself? It's easy to come up with the figures you'd like to save but I think it's also important to know how much you can save each month and how long it may take you to reach your goals.

    Also, you are still very young, don't deprive yourself too much for the sake of saving a few pennies xx
  • Welcome to the forum boards!!

    Dont worry about being young, im 20 and im saving for a mortgage deposit. The younger you start the better off you'll be in my opinion but Blue is right, be careful about over doing it.
    Maybe sit down and write out all your outgoing in comparison to your out goings then you can see clearly where your money will be going.

    Good luck! I wish you all the best and ill definitely follow your thread.
  • savingwannabesavingwannabe Forumite
    16K Posts
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    Hello unknownsam, what a great post. Welcome and here's wishing to a happy thread. It is never too early to start saving and inspiring for us. :beer::j:money::D:T:A:)
    Try to have a minimal spend year in 2021
    Saving change in money box.
  • Thank you everyone!

    I am starting to budget myself so I still have spending money as well, after paying my mum rent and my phone contract and CC etc. I'm not going to be an overly obsessed saver but I will be strict with my savings and save anything I can afford to.

    My main reason for this is that my family aren't in this best financial situation themselves and a lot of the reasons are down to not having savings and instead being forced to taking out credit which has got them into thousands of debt. Compared to them, my debt is only a minor which has turned into a lesson for me and better to make the mistake now instead of in the future! This is why I want to start saving.

    I will keep you all posted with any updates in regards to how much i've saved and what i'm doing to get there - hopefully i'll inspire others, especially younger people, to start saving!

    Now i'm off to compare savings accounts to get the best deal :)
  • edited 26 October 2017 at 7:43AM
    UnknownSammUnknownSamm Forumite
    7 Posts
    edited 26 October 2017 at 7:43AM
    So I have opened a limited access account with Virgin Money which I am using as an emergancy fund. You are only allowed two withdrawals a year so I won't be tempted to spend it unless necessary!

    Current balance: £8

    I have a Starling bank account I use as my current account and I am taking advantage of the goals feature. What I am doing is creating a 'Savings' goal, rounding my balance down to the nearest £1 after every transaction and using the change to put into my savings goal. When I have a nice round number such as £5 I then deposit it into the Virgin Money account.

    For example, if my balance is 32.57, I will put the 57p in the savings goal as it all adds up and I won't really notice the difference. If I have an amount such as 56.31 then I might round it to £55 and add 1.31 into the savings goal.

    This way I won't really feel the difference whilst contributing to my savings.
  • Skint_yet_AgainSkint_yet_Again Forumite
    5.8K Posts
    Ninth Anniversary 1,000 Posts Name Dropper
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    Well done on saving. Have you seen the latest £250 to switch current account in this weeks moneysaving email - might be worth considering
    0% credit card £1360 ~ paid in full
    0% Car Loan £7500 ~ paid in full
    JAN 2020 = NOW DEBT FREE
    Emergency fund £1000 / £1000
    Aiming to retire early in 2025 🥳
  • Well done on saving. Have you seen the latest £250 to switch current account in this weeks moneysaving email - might be worth considering

    Thank you, I have actually switched my Santander account to Halifax for the £125 deal, which I should receive next week, I literally did it the morning before the £250 offer came!
  • savingwannabesavingwannabe Forumite
    16K Posts
    Part of the Furniture 10,000 Posts
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    Are you aware that you can have more than one current account?
    Try to have a minimal spend year in 2021
    Saving change in money box.
  • I also round down balances and have managed to put a lot away doing so. Good luck with all the savings!
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