How to stop living paycheck to paycheck?

elsien

I have a variation on the theme. Two current accounts one which has the monthly bills going out from, and one for the rest less regular but still planned  stuff so council tax, water which are only 10 months of the year,  TV licence, MOT car tax whatever.

Then similar to you  I have accounts that money goes into every month for holiday,  other car maintenance stuff plus a fund towards a new car, and the house maintenance fund because I’ve got some expensive repairs that need doing. The rest goes into a rainy day savings fund. 

The rest for me is envelopes. Some people have bank accounts with virtual pots but that doesn’t work for me so I put a certain amount aside each month towards Christmas and birthdays, clothes social and whatever. It wouldn’t work for a family of six but it works for me and because it’s real money it’s not like waving a card which Doesn’t feel like you’re spending anything. As you say everyone has to find out what works for them.

EssexHebridean

An aside on a "real" envelope system is that people should check where their home insurance is in relation to keeping sums of cash at home - and work accordingly. Most standard contents policies have a relatively low limit for this. The thing about spending cash sometimes feeling more like spending real money is an excellent point - a lot of people do seem to find that they stop and think a little more when real live £10 notes are involved! 

I have the compromise between virtual pots and cash envelopes - literal separate savings accounts running alongside our current accounts which get "fed" their required amounts mostly by standing order each month. The SO comes out at the beginning of the month like most of the rest of the DDs so the money goes out to them without me even noticing. It's then shifted back when needed - ie from the "Car" pot for MoT. servicing, insurance etc, from the "Holiday" pot for booking the ferries, deposits on accommodation etc. 

Rosita8

I can't seem to reply individually-

Coffeekup-some good ideas I think-I like the 10 per cent 

elsien-I could try cash-I never seem to have any-I don't have a high street bank anymore so wouldnt be able to withdraw certain denominations I don't think?

EssexHebridean-Eek I would not have thought about the home insurance aspect-I could look into the bank account idea

Thanks all