Time to build my future

bigbeff

So at the beginning of September I finally became debt free - apart from my mortgages, and my debt free diary helped me so much so I thought I’d try and keep it going in order to build some savings.

In terms of savings, I am setting up an emergency fund of £1k, and I am setting up a regular saver to overpay mortgage when I need to remortgage in July. I already have a tax account ready for my big bills and I want this big enough so I don’t panic each time I get a bill! Oh and I need a holidays account!

So, now to choose best account for my emergency fund, I already have two regular savers for holidays and mortgage overpayments, but ideally I think I need instant access for emergency fund. 

Happy savings and I look forward to reading your diary’s for hints and tips!

Skint_yet_Again

Hi @bigbeff welcome and well done on becoming debt free 🤗

I was looking at savings accounts over the weekend and Santander have an instant access at 5.2%

https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/

Look forward to following your journey

joedenise

I've been reading your DFW diary for quite a while and have decided to follow you over here to your savings diary!  I think it's a great idea.  I have bookmarked it so it is easy to find again.

I use premium bonds for my Emergency Fund but if it's an emergency in that the money is needed immediately I use a credit card to pay it and then get the premium bonds out to cover it which arrive in my account in about 4-5 days.  Not sure if you have a CC but might be worth getting one for this very purpose.  It also gives you some protection when buy anything over £100.

bigbeff

Thank you @Skint_yet_Again . I finally feel like I am in a position to look to the future 🙂

It seems crazy that I have been paying approximately £800 a month on debts… I just need to make sure I don’t squander it now!

LittleMissDetermined

Hello @bigbeff and congrats on starting your savings diary, I have bookmarked and will be here to cheer you along. 

I found that now I am debt free I have found a balance of saving and 'living' a bit more. It suits me and it means I can enjoy taking part in social things, and have the odd treat whilst still having the savings for emergencies, holidays and the future. 

I know you'll soon find something that works for you and I know that after all your hard work you won't be able to 'fritter' anything.  If you feel like you are, you can always go back and read your DFW diary to remind yourself of what it was like having the debt.

Good luck with the savings
LMD x

bigbeff

Thanks @joedenise and @LittleMissDetermined

I'll find the right balance... I do still have a credit card with zero balance...I'd not thought about that idea! 

Baron_Dale

Please find below a post I wrote for you this morning which I inadvertently placed in the wrong thread. I have apologised to  @LittleMissDetermined.

Congratulations on becoming debt free.

How much are you able to save or invest each month?

I would suggest the following, but each to his/her own!

1)An instant access account for the emergency fund. Aim for at least a £1000 and then add to it as desired.
I would not want to use a credit card as an emergency fund. However, I can understand that you may need to do so while building up an emergency fund. But stay disciplined and pay off in full before interest kicks in.

2)A savings account for annual bills, travel, Clothes, Christmas and birthdays. Work out a budget for each category, total them all up and divide by 12. This will be your monthly contribution to that account. Perhaps start it off with a buffer amount of say a £100. I have one account for these things bit it is divided into several pots on my spreadsheet. Also best to have a savings account that is easy to send money to and from your current account. I have a NW current account and a NW Loyalty saver for this purpose.

3) Longer term savings could be invested in a S&S ISA with a monthly contribution.

4) Perhaps a regular contribution to a cash ISA for medium term savings.

Personally I keep my Premium Bonds as a separate investment and don't touch them.

If you under 40 open a LISA asap and save to that regularly and enjoy the bonus money paid by the Government.

The key remains a sensible and accurate budget for each area of expenditure. 

You can read about how I do it in the thread in my signature.

Best wishes.

bigbeff

Thanks @Baron_Dale the planning is the way forward. I have a lifetime isa, I’m now 41 but opened before I turned 40! Not much in it mid, but I can start to take advantage of that. 

Haven’t really thought about money this week, back at work and first few weeks are always crazy trying to work out which students are supposed to be studying E&M and who they are so I can make sure they are on right course. I was in bed by 830 on Friday exhausted!!!

But had a pleasant weekend, saw my brother and then went to spectate while my mate ran her first Ironman! Weather wiped me out and I was only watching 😂

Sarahwithlove

Hi I've followed you over from your previous journey. Congrats on getting debt free. Long term I would suggest some kind of emergency fund be your main focus. Then I would look at a sinking fund if you don't already have one for your annual expenses and maybe add a category for holidays etc. Then a mortgage repayment account. Hopefully that would stop you needing to get into debt again and give you some extra to pay off the mortgage when comes to renewal time. Good luck, I have bookmarked to follow your new journey 

Baron_Dale

How are things going?

bigbeff

Hi all, 

I have been awol for a bit, I think I just needed a break from it all. I have been keeping up with my savings though and been mindful of my money. Had a lovely few days in Lisbon at the beginning of the month which was amazing, although came back and car promptly broke down on the motorway, thank goodness for RAC membership! So my emergency fund has taken a battering this month and is now low. I also got my tax bill which wasn't as high as I was expecting, so my priorities over the next couple of months are to build emergency fund back up and make sure tax account has enough in for first payment without dipping into my other pots. 

So aim number 1, by 1st January
1) Add £600 to tax account
2) Add £600 to emergency fund 

Today I am working from home, so hopefully a no spend day. 

I hope you are all keeping well - I'm off to open prolific and see if there is anything there for me. Every little counts!