ADHD and saving money instead of spending it... Easier said than done!

staceyd1991

always had "issues" with money all my life... overspending, not living within my means, trying to "keep up with the jones"... been pretty much in some form of debt for the last 12 years since i was 18.

i finally had a diagnosis of ADHD in May 2023. My entire life all of a sudden made sense in that moment.

You could say that day was my "lightbulb" moment when it came to my spending habits and the fact ive never even saved more than a few hundred pounds before spending it "when ive had a bad day" and the fact i was on that day in £18k worth of debt with not much to show for it.

fast forward to now... i am extremely proud of myself for what i have accomplished for the first time in my life... I AM COMPLETELY DEBT FREE! £18k worth of debt paid off in 9 months.

But now I know ive completed this "mission" i set myself back in May 23, I now need something new to focus on... SAVING MONEY!

Over the last 9 months every spare penny I had went towards paying the debt back. I sold countless things on ebay to use as my "spending" fund.

Recently had a income increase which means I can save more than I thought but how much is too much to save?

I do need to "satisfy" my ADHD spending cravings but this doesnt include spending masses amounts of money like it used to. Letting myself have a small spending pot helps me keep focus on the real task i want to acheive.

Bit of back ground... my income currently stands at roughtly £4100 a month. Monthly outgoings e.g bills, rent, food etc is £1100 at a max each month.

this leaves roughly £3000 a month to pretty much "do as i please with" so to speak.

But how can I use this wisely? 

I do want to create a healthy savings account but also ive missed out on "living life" for god knows how long and havent really done anything apart from work and come home. the odd night out. the odd night away with my partner

ive opened a monzo savings account and i will be doing the £12k in 2024 challenge, already set up the standing order for £1k a month (will put £2k in at the end of this month to catch up)

should I just stick with that and live a little this year? but i am worried of slipping back into old habits and that is my greatest fear. But with ADHD its extremely hard to focus on anything so that fact ive managed to do what i have already is massive in itself.

I dont really have anything im saving towards more of a rainy day fun and £12k should be more than enough.

lovemula21

I have ADHD too and it has taken a long time to get my finances in a good place. Well done to you for playing off so much debt in 9 months!! 

Saving £1k/ month sounds like a sensible plan. 

I have 3 suggestions: 

1) make sure the monzo account is giving you a decent rate of interest. If it’s less than 5% shop around.

2) have a goal for your money. Perhaps the goal could be to have an emergency fund that would see you through 6-12 months of unemployment. Then it could be to buy something big like a car or house.

3) consider putting some in a pension especially if your workplace do salary sacrifice. 

With £3k/ month spare you are in a good position to set yourself up for the future while still having a nice life now. 

MeteredOut

Definitely look to a pension. I'd work back from what age and what you want to live on when you retire, taking into account any pensions you already have, including your state pension expectation, work out what pension pot you'll require to retire on that income, then work out (using some assumptions on growth) what amount you need to put away each month.

Note that, based on your age and current pension provisions, there's a chance the number could be greater than your £3K, but at least the process of doing that should you make a decision as to how much you want to put towards your pension.

The good thing about putting a percentage of your £3K into your pension is that you'll get used to being without it, and the money is pretty much locked away, meaning you might be less likely to relapse should your ADHD tempt you down the spend, spend, spend path again.

Archerychick

Firstly, set some goals and I would also recommend that you budget for a pot of money each month that is your ‘have fun’ money - this pot you can use to satisfy your spending desires. If you haven’t you also need to have an emergency fund.

If you are not already paying into a pension, do this because if you’re not, you are turning down free money from your employer, and you could pay enough into your pension so that you bring your pay so you only pay 20% tax on your earnings. Plus you won’t be able to access your pension until later in life.

Rich1976

I don’t know much about ADHD but I use a spreadsheet every month, split into 3 sections

Essential bills so basically all the household expenses that are paid every month
Savings and Pensions, a predetermined amount is sent to our individual pensions every month on top of our employer schemes. With Savings I try and make this a minimum amount every month and then this is topped up if there are no annual expenses like the car insurance to be paid. It also covers holidays, repairs and maintenance , home improvements and a replacement car we are saving up for as well as an emergency fund

the final category is called Fun and Entertainment which is everything such as Netflix and Spotify, my other half’s gym membership and spending money which can be used for eating out, coffees, the occasional takeaway, cinema , any clothes we need etc

i have found that by doing it like this removes the urge to spend too much or to save more than we should be doing to the detriment of living life. So we have no debt either and can save what to most people would be a healthy amount every month, it also means we can have quite a healthy spending fund too. If one month we go over and spend too much then as long as it’s not every month then I’m ok with it because I know we are still saving.

the other thing is to have goals so you know what you are saving for. So you could have a holiday you’d want to go on or some I don’t know expensive pair of trainers or a car as an example. Knowing your savings is going towards these is an enormous motivation. 

But equally it is important to enjoy what you earn. No point having thousands in savings but eating beans on toast every night. It’s about getting the balance right in each area.

LHW99

Pension, or LISA for at least part of the money.

If you are contributing to your work pension (hopefully you didn't opt out, if so opt back in quick) see if your company will add more if you do.

A LISA also gets a contribution from the Government, and can be taken earlier than state pension (currently) or could be used for house purchase.

enthusiasticsaver

If you are doing the £12k challenge then that is a good thing.  You have a lot of disposable income so I would decide how much you are comfortable spending each month and put it into a separate savings space or account.  Maybe have a target of a new car or bigger house or holiday.  If you plan on retiring early then you would do better to stick some of the spare money into your pension. 

aroominyork

Rich1976's advice might be helpful to you and of course most people on here will (rightly) mention pension planning. But I am only posting because I want to say well done - you should be really proud of yourself.

LHW99

Having your "fun money" spending pot is also a good idea, and something that plenty of people do, with or without ADHD - it takes away any guilt of spending purely for your own pleasure / wants.

Beddie

You've done well to have a highly paid job with ADHD - I guess you are able to control yourself well enough to carry out work tasks effectively. Something I never really managed to do.

staceyd1991

Thank you all for your replies, currently still doing well with the savings thing, got £4K now in savings.
in regards to pension I’m paying into a work one at the moment, I’ve found something I want I aim towards. I’ve always dreamed of visiting a few places (bucket list if you will) in  America, (New York, LA and Florida) so my goal this year is to have £12k in savings as a sort of “rainy day” fund and open another savings to save for my America trip! Not a clue how much it’s gonna cost me il need to figure out costs flights hotels spends etc, I plan to save the money this year and book everything at the end of the year and go next year, I’m thinking a month long trip to visit these three places, I’m excited all ready! Just renewed my passport this week as it was close to expiring!