How much can someone like me save?

Peggy0628

I'd like to compare notes here...
How much can someone on £18500/year take home pay realistically save?
The situations is: rent £5400/year, no partner/kids/car to worry about. The usual bills (council tax, water rates, gas, electricity, internet, home insurance, cheap PAYG phone). No TV licence, take-outs, holidays, minimal social life, only buy new stuff (clothes/shoes etc) when old needs replacing (can't see any big items needing replacing any time soon).
Hoping to buy my first car this year but don't want to get finance/loan. No savings at the moment, no chance of inheritance or financial gift.
How much can I reasonably save by the end of the year (without living on beans on toast the whole time)? Thanks!

Daliah

Fill in an SOA, that should give you the answer.

If you want someone to review and comment on it, save it in MSE format and post it on the Debt-Free Wannabee board. They have nifty ideas over there.

anotheruser

Just calculate your monthly take home pay, minus monthly bills and see what the answer is.
Effectively, this is what you COULD save (but it'll likey be a little different each month).

Don't try and guess how much you may spend on clothes a month - for me it's a case of spending £100 this month, nothing for two months, then spend maybe £5 the next month, perhaps £20 the month after, then nothing for four months - just depends if I see something worth buying.

Peggy0628

The trouble is, I don't know how much a lot of those bill are going to be... Living on my own for the first time, not had any energy bills trough yet for example. I can guess but it could be way off...

theoretica

Look at how much you spent last year and then think about any changes you know about, and changes you want to make (eg less lockdown) or are willing to make (spending where you would rather save the money).

Not what you asked, but for first car do be sure to budget for insurance - it can cost more than a cheap car!

Peggy0628

@theoretica I did a bit of research on that part and I can get fully comp insurance for around £400 (I'm not as young as you probably think - I've had a full licence for almost 20 years, just never owned a car).

As for the rest - I have until recently lived with my (now ex-)partner who took care of all things financially (all bills were in his name only and I never had any say in the choice of providers/tariffs etc - most of the bills/bank statements, if not all, were paperless and I have no access to any of them) so I have no record of how much anything was. I just know there was no money left at the end of the month but have no idea where it all went. I know it's a weird situation but I have no idea where to start.

Coffeekup

A month will set you back roughly the following....

Council tax £120 depending on band and area but as you on your own you'll should get a 25% discount.

Gas and electric £35 a month for each, more if you like the heating, lighting on, more if you have a bigger house. 

Broadband/interweb..... £20-40...(if you don't have a pc/laptop and play games, stream TV, you may not need this as you can do everything else from you phone)

Home insurance £10-20 a month.

Water depending on area £25-60.

SIM Only contract...£5-10 maybe more if you use your smartphone for alot of data.

Then you have you food... £40 a week... This is the biggest variable, some on this website can do a weekly shop for next to nothing, others like a few treats, ready meals, and finer foods like salmon for breakfast... Which will make your shop more costly.

Don't forget to put some aside for birthdays and Xmas..

How much can you save ? £0-500 a month. Once you have a car? £0-300

grumbler

Coffeekup said:

Home insurance £10-20 a month.

For a tenant? I think content insurance has to costs much cheaper (if is really worth having at all).

eskbanker

Peggy0628 said:

Living on my own for the first time, not had any energy bills trough yet for example

Especially given the direction of energy prices, it would be prudent to budget for peaks rather than troughs

born_again

Peggy0628 said:

The trouble is, I don't know how much a lot of those bill are going to be... Living on my own for the first time, not had any energy bills trough yet for example. I can guess but it could be way off...

Sweep excess funds each month from current to a savings account till you have a better idea of your spending.

Try to keep to home cooking rather than ready meals or takeaways. Extra jumper rather than heating up a couple of "C"

Remember sausages in beans are not much more a tin 🤦‍♀️🤣

maman

I assume you're saving for a deposit or perhaps just to have some cushion.

What I'd do in your situation is only spend on absolute needs not wants for the coming year. At the end you'll have a better idea of regular bills. I'd keep a spending diary of every penny you spend. Sometimes just knowing that you have to account for it will make you change your mind about spending. View it as a challenge. Review the diary regularly to see what you can cut back on. Things like coffee and ready made sandwiches can be a huge waste of money when a bit of planning can save pounds.

Good luck and keep us posted. 😊