Debt free before August 2023

enthusiasticsaver

A basic emergency fund is usually £1k on the grounds that would normally cover most emergencies -house,car, pet related. The 3-6 months expenses is to protect against job loss. I think in your case I would continue with the help to save and divide any surplus you have between emergency savings and extra spends. 

Poppy1984

enthusiasticsaver said:

A basic emergency fund is usually £1k on the grounds that would normally cover most emergencies -house,car, pet related. The 3-6 months expenses is to protect against job loss. I think in your case I would continue with the help to save and divide any surplus you have between emergency savings and extra spends. 

Hi @enthusiasticsaver that makes sense I guess because I have more than £1,000 saved in my hell to save already I'm feeling a bit like do I really want to save that again in another account. I think I'll put aside around £400 in a separate account whilst the help to save is on the go in the hopes that any emergency's I could use that rather than filling into the help to save then in jul 2023 when the £3,000 is available I'll re asses my situation and see how much to put aside for an emergency fund. I could really do with a new car but it's one of those questions isn't it is a car an emergency? Not really unless my old one suddenly went caput I don't think I'd class it as an emergency.

a lot to mull over and process I think

Poppy  

savingholmes

Hi Poppy - do you allow yourself some 'free/hobby' spends each month? Perhaps allow some extra for that and then save the rest... Would that work? Do you have anything left you'd be happy selling to give you more free cash to play with?

enthusiasticsaver

What is the help to save money earmarked for? Emergency saving really should be easily accessible and ideally never touched. We haven’t touched ours in ten years but is there as a security blanket just in case. Saving for replacement cars or house repairs etc would be somewhere separate as you know it will be needed at some point. I think your plan of putting a few hundred aside is good and then reassess once the HTS has matured. Allocating some spending money each month is a good idea.

Poppy1984

savingholmes said:

Hi Poppy - do you allow yourself some 'free/hobby' spends each month? Perhaps allow some extra for that and then save the rest... Would that work? Do you have anything left you'd be happy selling to give you more free cash to play with?

@savingholmes

Not for the last nearly 4 years I haven't no, so it's going to be weird actually having some disposable income! 

I've nothing to sell, sold it all to pay off debt. 

I guess im planning for my consumer debt free future and thinking how I want things to go, as I don't want to blow it all but also don't want to leave myself too tight of a budget by saving everything. Guess I'm nervous of having a less restrictive budget and nervous of not getting back into debt again. 

Poppy  

Poppy1984

enthusiasticsaver said:

What is the help to save money earmarked for? Emergency saving really should be easily accessible and ideally never touched. We haven’t touched ours in ten years but is there as a security blanket just in case. Saving for replacement cars or house repairs etc would be somewhere separate as you know it will be needed at some point. I think your plan of putting a few hundred aside is good and then reassess once the HTS has matured. Allocating some spending money each month is a good idea.

@enthusiasticsaver the help to save isn't embarked for anything. It's kind of my emergency fund at the moment because it's easy accessible but because of the conditions of it if I was to withdraw money I would receive less of the bonus at the end so making me not wanting to touch it unless there was an emergency if that makes sense. 

Do you have 3-6 months living costs saved that you haven't touched for 10 years? Does it earn you any interest? 

I guess coming from having a very tight budget for so long I don't want to immediately go into a situation where I'm saving as much as I was paying off debt and still on a very restrictive budget, so its trying to get the balance right. 

I've been tinkering about with figures tonight and I think what I might do is continue to save my pots up for annual expenses. Put £84 a month into an emergency fund letting it build to £1,000 over the year. When my hell to save matures I will re asses and decide whether I want to use some to add to my emergency fund. 

So helpful talking this through with you all thank you 

Poppy  

savingholmes

Love the 'hell to save'

If you can allow yourself some guilt free funds I think it would help. Just pick a number and start with that. If its okay in your budget - the following month consider if you can go a little higher and gradually increase it to a number that feels comfortable.

enthusiasticsaver

Trying to get the balance right between saving, spending and if applicable paying off debt is tricky. Having an emergency fund is a security blanket and yes we do have enough in ours to cover 3-6 months living expenses although we are early  retirees so job loss or sickness are not an issue but we might need to replace the boiler, fix the roof or pay out for health issue privately if NHS lists too long so we like keeping it. It doesn’t earn much interest though like most savings accounts at the moment. Your plan sounds sensible. 

Poppy1984

savingholmes said:

Love the 'hell to save'

If you can allow yourself some guilt free funds I think it would help. Just pick a number and start with that. If its okay in your budget - the following month consider if you can go a little higher and gradually increase it to a number that feels comfortable.

Hahaha Freudian slip, it's certainly hell to save rather than to spend 🤣🤣 

maybe, I guess what I'm thinking is I don't want to give myself an exact amount like I can spend x on whatever I want as then it might become a target for me to aim towards even if I don't need to. 

I think I want to get my savings sorted then any that's left over I can use as I wish but what I don't spend will probably get transferred into savings. 

I think I'll just see how things goes and keep reassessing every few months. 

Poppy

Poppy1984

enthusiasticsaver said:

Trying to get the balance right between saving, spending and if applicable paying off debt is tricky. Having an emergency fund is a security blanket and yes we do have enough in ours to cover 3-6 months living expenses although we are early  retirees so job loss or sickness are not an issue but we might need to replace the boiler, fix the roof or pay out for health issue privately if NHS lists too long so we like keeping it. It doesn’t earn much interest though like most savings accounts at the moment. Your plan sounds sensible. 

I need to get my head around having money that I don't touch in an account, as I've never done it before. I've saved for a goal and then used the money for that purpose but never had money just sat there just in case. Obviously it's something I need to keep me out of debt, so I will get my head around it. I do want to be able to live a little after being so restricted for such a long time though. So definitely need to find the balance. 

Poppy