What I have stopped buying in order to save money

Since being on a budget I have stopped buying so many items in order to save money but I thought I would share the top 5 things that has helped me save some extra cash.

Back in 2018 I was wasting so much money on these 5 things and only saving £50 a month, that I knew needed to change. So in this post I will be sharing what I have stopped buying in order to save money and how I have reduced the cost of these items if I still use them.

Meals for work:

I work full time and they are shifts, so I could work early in the morning or late at night. This means that sometimes I need two meals at work which can cost a lot of money. Before I started learning about money and how I can save it I was buying microwave meals, takeaways and lots of snacks.

On average I was spending £200 a month on food for work which over a year works out to be £2,400 on just food! Which is terrible. Not only was this money bad for my health it was also damaging to my bank balance.

So I decided to learn how to meal prep to save some cash. And it is the best thing I have done, I am eating better and my bank balance is looking healthier.

Meal prepping is an amazing way to eat better, save time and money. Twice a week I spend a few hours cooking all sorts of meals for that week. I make breakfast, lunch, dinner and even snack pots. I spend on average £10- £20 on healthy ingredients and I make enough food to last over a week.

I will be sharing a post very soon on my top tips when it comes to meal prepping!

Expensive makeup:

I cant believe the money I used to spent on makeup when I was on a low income. I used to buy expensive makeup products and hardly use them.

But since being on a budget I have made some changes, I still buy makeup but I have changed the products I use and where I buy them from.

I now shop around, look out for offers and also free samples. I once received free samples of lipstick, mascara and eyeliner that lasted me over 6 months which saved me a lot of money.

I still treat myself to beauty products as I like to look nice, but I am sensible I only buy when I really need to and I shop around for the best offers I can find.

Hair dressers:

I love my hair and I used to spend a lot of money on hair cuts and highlights in order to keep it looking great. But I was spending on average £50 a month, which over a year equates to £600.

I have spent the last year researching how to trim my hair and maintain a style which has saved me hundreds. I now go to the hairdressers once a year for a style change and cut it myself the rest of the year.

I also learned how to dye my own hair, which costs me £10 a time, I have a lot of hair so I need to use two box dyes. But on average 1 box of hair dye cots £5. This has saved me nearly £500 a year!

Nights out:

I am not a huge social butterfly but I do like a night out. And back in 2018 I was spending so much money on trips to the pub after work that was ruining my budget. I never set myself a budget and I used to spend money I didn’t really have, I could spend up to £80 a night just drinking and eating in a pub.

I have now stopped spending this amount of money. I still go out however I set myself a limit depending on where I go. Usually I spend less then £30 a night and this does include travel. More often then not I car share with someone, or if its local to me I walk home.

Have you heard of a thing called “pre drinks” well I do that as well! If I am going out to have a few drinks I do drink at home to save some extra pennies.

I am in my 20’s so I do like to enjoy myself but it is all about being sensible.

Buying clothes:

I love clothes and I used to love buying them but on average I was buying clothes from online stores. I could spend £50 -£100 a week buying new clothes for nights outs, dates and all manner of events and it was ruining my finances.

I now buy 2nd hand clothes for every day wear and I also limit myself the amount of times I buy clothes throughout the year. At the beginning of the year and the end of the year I will spend £100 on clothes that will last me throughout the year. I also make sure that I shop around for discounts and sale items to try and keep the cost down.

I have also unsubscribed from all online clothes stores so I am not tempted by their offers. If I need clothes I will search online for sales and discount codes.

A quick disclaimer, just because I do not use these items or don’t like spending a certain amount of money on something it doesn’t mean you don’t have to. Everyone has a different situation and for me these were the 5 things that I was wasting money on.

I hope this post has given you some food for thought and maybe inspires you to change your budget in order to save money.

What have you stopped using since being on a budget? Do you miss it? Let me know in the comments!

What is the best budgeting method for you?

There are many different types of budgets out there, for all types of people and situations.

But what budgeting method is the best one for you?

When I first started my budgeting journey I had no idea what a budget was much less what type of budget was right for me. Since being on a budget I have tried two budgeting methods, Cash envelopes and a zero based budget.

But I was also interested to find out what other methods are out there and which ones are the most popular.

So if your new to budgeting or want a change but not sure what budget to go for then keep reading as I have done some research and found 3 of the most popular budget methods. I will be sharing the basics of the method, who it will work best for and what could go wrong. So keep reading.

The Balance Money Formula (50-20-30)

https://www.thebalance.com/the-50-30-20-rule-of-thumb-453922

The balance money formula is most commonly known as the 50-20-30 budget and is very popular.

This method uses percentages to determine how this budget works. The idea is to spend 50% of your total income on your needs, 20% on savings, and 30% on wants.

But what is a need? 50%

A need is something that you need in order to survive such as mortgage, utilities, clothing, groceries, gas and much more. Basically anything that you cannot live without!

But this doesn’t mean that you can treat yourself every now and then.

What about savings? 20%

Your savings consist of any saving goals you have such as an emergency fund, debt repayment and even retirement goals.

It is a similar concept to what Dave Ramsey advocates with having a small emergency fund and concentrating on paying off your debt. (Keep an eye on my blog posts as I have a post coming soon all about Dave Ramsey’s baby steps)

What is a want? 30%

Your wants are exactly that, it is something that you want. You can live without it but you want it.

This includes TV subscriptions, clothing, technology, entertainment and anything else that you would like.

Is this budget for you?

This budget is designed to make budgeting more fun and easier to understand. Some budgeting methods have many different categories and this one only has 3.

So this budget is perfect for anyone who is starting out and finds budgeting confusing as it is very simple to follow.

What could go wrong with this budget?

Overspending has been described as the most common problem with this budget.

Since you are only budgeting for 3 categories it can be quite easy to spend a little too much on food for example and forget that you are low on fuel.

This best thing to stop this from happening is to have some wiggle room in each of your budgets. That way the money can be freely moved from your “wants” money to your “needs” if you overspend.

Cash – only budget (Cash envelopes)

https://debtfreecaribbean.com/2019/04/02/cash-envelopes-system/

This method is exactly as it sounds, it is cash based!

It is also known as the cash envelope system, where by you only use cash. This method of budgeting has been around for a long time. I remember my grandmother doing this method with her money many years ago. She would have an envelope for food, gas, electric, petrol and savings.

With this method you have a few categories, and then you withdraw the cash out from your bank account. The categories you have depend on your lifestyle, but they mainly include Food, transport, fun, holidays and so many more.

For example if you have a food budget of £400 for a month you will withdraw this from your bank account and keep it in an envelope.

Is this budget for you?

This budget has been described as working best for people who struggle with overspending. As once the cash is gone, it’s gone.

This method also encourages you to leave debit cards and credit cards at home and only use cash.

You can use credit cards if you so wish but it has to be in an emergency and not for every day spending. Using credit cards is completely dependant on your situation, if you are paying off credit card debt then perhaps this isn’t the best idea to use them.

It also allows you to save for all the fun things in life.

What could go wrong with this budget?

Well for one thing you need to make sure that you don’t carry a lot of money with you and not bringing all your cash envelopes with you as this is a risk.

To look after your money there are many envelopes holders online, check out amazon for affordable holders.

It’s also very easy to get confused as it is cash so I would recommend keeping receipts in with your envelopes to keep track. Perhaps even creating a spending tracker.

Zero- based budget:

The zero based budget is the method that I have used for the last two years and it has worked so well for me.

Zero- based budgeting is where the money you have in income matches exactly what is going out of your account. Essentially every penny you earn is being used.

But, this doesn’t mean that you are spending all of your money, it also refers to the money you put away for savings as this is “leaving your account”

When it comes to savings, on pay day you are paying your saving accounts. I pay “myself” (savings) before I spend the rest.

Basically some of your money is going to pay your household bills and the rest you are either paying off debt or maximise savings.

This method is very useful if you are following Dave Ramsey Baby steps, as his steps are all about maximising savings and paying off debt.

With this method, if you were to save and spend exactly what was in each of your budgeted categories, you wouldn’t be positive or negative. You would literally be at £0.

Is this the budget for you?

This budget has been described as the ultimate budget for people who want to be completely in control of their money, like myself.

It allows you to micromanage your money in a good way, as you get to decide in advance where every penny gets spent.

You typically wouldn’t spend any money unless it’s planned for.

This budget is also good for people like saving for many things at once, such as sinking funds. I have found this budget is great for helping me save all year round for birthdays, Christmas and holidays.

What could go wrong with this budget?

With every budget there are things that can go wrong.

Zero-based budgeting can be quite time-consuming due to how much planning and tracking is involved.

Ideally you need to have something that records every transaction so you do not go over budget. For me I use a banking app called Monzo which tracks all my spending and its much easier then writing it out every day.

As I live at home I do not have many bills so for me this budget is very managble as I do not have many outgoings. But if you are someone who has a lot of outgoings then this budget can be a bit too much.

I have also noticed that in this budget there isn’t much room for mistakes as your ending balance is £0 so if you are new to budgeting then perhaps try one of the other methods until you have a better understanding.

https://www.forbes.com/sites/donnafuscaldo/2020/01/23/two-fintechs-aim-to-change-the-poor-savings-rates-among-americans-with-new-products/

I hope this post has giving you an insight into the many budget methods are out there and what ones could work for you.

There are many more budgets out there so please research the best one for you. And it is okay to make mistakes when it comes to budgeting, you need to make mistakes in order to progress.

You can also do your own budget where you incorporate many components of other budgets and make it your own, I know this works for so many people.

Let me know in the comments what is the best budgeting method!

All you need to know about the cash envelope system!

I have been using the cash envelope system since September 2018 and it has not failed me yet. I discovered the cash envelope system on YouTube when I saw so many people use it as a way to track their spending and savings.

But what is the cash envelope system?

The cash envelope system is simply a way to divide your spending into different categories. These categories can be anything that allows you to pay for things in cash. For example I only use 3 cash envelopes for my spending, these include:

  • Spending (Dates, days out etc)
  • Food (Meal prep, eating out etc)
  • Petrol

All of these I can pay in cash with. For me the cash envelope system is a visual reminder of how much money I spend. When I used to pay with my debit card I took it for granted and didn’t think much about what I was spending. It wasn’t until I had my bank statements through I realised that my money is going nowhere, I was wasting it.

From that day on, every month I budget an amount for each envelope and do not change this, unless there is an event or something that requires more money.

Here is an example of much I budget for each envelope:

  • Spending: £100
  • Food: £80
  • Petrol: £60

The only way the cash envelope system is going to work is if you have a budget in place. If you just make up numbers and do not follow a budget this system will not work, the whole point of this system is to keep you accountable for your spending. 

Here are my rules for using the Cash Envelope System:

  • You need a budget!

Plan your budget before you even think of using this system. You need to figure out how much you are going to need in each envelope. I did a practise month to see if what I was putting in my envelopes was enough money or too much money. The first month I done this I did not put enough money in my petrol envelope which meant I had to borrow from my other envelopes!

  • Create your Cash envelopes.

At the moment I only use normal white postal envelopes as it’s easier for me. However, there are many websites that have cash envelopes, the best one is Esty (https://www.etsy.com/uk/market/cash_envelope). There are hundreds of amazing designs that you can choose from.

These are my 3 ‘spending envelopes’
Image is from: https://www.etsy.com/market/cash_envelope
  • What are you going to use your cash envelopes for?

You need to decide what you are going to use your envelopes for. Are you just going to have some to track your spending? Or create ones for your bills? I personally only use cash envelopes to track my spending and also to save money for various events throughout the year. I keep money in my bank account for all my bills as for me it doesn’t make sense to draw the cash out to put it back into my account before the direct debit is due. But the decision is yours!

  • Do not borrow from other envelopes!

This is a major rule! You cannot borrow from other envelopes. For example if you are getting low on your spending envelope you can’t take money out of your food envelope. The whole point of this system is to make you aware of your spending. So if you’re running out of money from a certain envelope then you need to either budget yourself more money or find a way to cut your spending for that category. For the first few months you try this you will make mistakes. But stick with it, believe me it’s all worth it.

  • Keep track of your cash spending.

For me this is another important rule, I have created a spending tracker that keeps me accountable for all my cash spending. (See picture bellow) This keeps me motivated every month as it makes me realise how much I am spending. I recommend that you do this as well.

I hope that these tips have inspired you start the cash envelope system. I cant recommend it enough, it will take a bit of work but it is so worth it.

Since starting the cash envelope system I have saved so much money, it has made a massive difference to my fiances and I couldn’t be happier.

So if your like me, someone who struggles keeping track of their spending, who needs to be on a strict budget, then the cash envelope system is for you.

Please let me know if you any questions in the comments below and I would be happy to answer them as best as I can.

Below are some links to websites and videos that have helped me understand the cash envelope system.

Pennies into Pearls: http://www.penniesintopearls.com/beginners-guide-cash-envelope-system/

Alyssa Herbert: https://youtu.be/nME9Ei1Ne7U

From Pennies to Pounds: https://www.frompenniestopounds.com/how-to-make-a-cash-envelope-system-with-cute-printables/#more-3997

That is all for now! Talk to you soon 🙂

Hannah xx

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