If you are anything like me you love shopping the online sales, especially when you get emails every week telling you about the ‘70% off sale and free delivery when you spend £30!’ You add an item here and there and before you know it you have spent over £100 on clothes.
But when you are on a budget this is not ideal and can cause some people to get themselves into even more debt and over spend.
I was that person, I would shop the boxing day and January sales to find the best bargain! In December 2019, I spent £250 on boxing day I bought clothes that I didn’t need and I never wore them.
For me, last year was the final straw when I had to pay off my credit card bill of over £200 that I wasted on clothes.
So keep reading as I share 3, yes only 3 really easy tips to help you stop impulse buying online.
Unsubscribe from emails
Ever heard of the saying out of sight out of mind? Well this couldn’t be more true for emails. Think about how many emails you get each week from different online stores, they are always there in your face tempting you to buy. I used to get hundreds of emails each week showcasing online brands sales and discounts and nine times out of ten I would buy from there.
So the first thing I did was unsubscribe from these companies, it took a while to do (I had so many subscriptions) but it was worth it. I do not receive any emails from online stores which means it doesn’t tempt me each day. I never know what stores have what sales unless I search for them myself.
This will make a massive difference to you and your bank balance.
Ever sat in front of the telly on an evening browsing through your phone and looking at shopping apps on your phone? How easy is it to add clothes to your basket and pay for it in seconds. It is only after that you realise how much money you have spent.
Most clothing brands have an app that makes it even easier to buy clothes, they can send you notifications throughout the day which again reminds you of their offers.
So the easiest thing to do is delete them from your phone. Last month I deleted…..
Pretty Little Thing
Nearly every day I was flicking through these apps and making small purchases which were going on my credit card and causing me to get into even more debt!
Now they are gone I don’t think about it.
Wait 24 hours before buying
This tip has helped me so much! It is as simple as leave the items in your basket for at least 24 hours before buying. This will give you time to really think about this purchase. Most of the time you will forget about the items and not worry about them.
If that’s the case I put the money I would have spent into my saving account or write it down. Then at the end of the month I can see how much money I have saved!
What do you think of my tips? Do you do the same or something different? Let me know in the comments.
Don’t forget to give me a follow over on my Instagram @budgetwithme1 to keep up to date with my journey
On my Instagram I have been asked many times to share my top tips on how to start a budget.
Having a budget that works is so crucial to paying of debt or increasing savings. But it is always so difficult knowing where to start.
So if you are unsure then keep reading this post as I share what I have done to start my budget. As always I am not trained in anything to do with finances these steps are what I have done to pay off debt and increase my savings.
Step 1: Write down your goals
The best place to start is writing down your goals. Are you paying of debt, increasing your savings? Whatever your main focus is write that down.
But you have to be realistic, the best way to achieve your goals is to make them manageable.
My goal for 2020 was to save £10,000, this was my main goal, but within this goal I broke it down. For example:
I need to save £770 per payday(13 paydays)
I need to save £5,000 in the first 6 months of the year
This is how I broke down my goal and it really helped. When I reached £5,000 in savings I felt a huge sense of achievement and this gave me motivation to reach my next milestone £10,000.
Step 2: Work out your monthly bills
Now you have a goal in mind and you have planned how you are going to do this it’s time to work out your monthly bills.
Take a look at your bank account and write down all the bills you have and what days they are due for payment.
Here are mine as an example:
Car Tax: £13.12 Due 2nd each month
Phone Bill: £23.99 Due 14th each month
Canva: £10.99 Due 20th each month
Rent: £150 Due 20th each month
Netflix: £8.99 Due 27th each month
Having all your bills written down and the due dates will help you have more control over the money leaving your account.
I like knowing when the money is leaving my account, that way if there is an issue with payments I can investigate it easier as I know how much I owe and when it is due.
Step 3: Remove unused subscriptions
Do you have any entertainment subscriptions that you don’t use any more? If so now is the time to get rid of them. Before I started my first budget back in 2018 I removed many subscriptions that I hadn’t used.
In my first month of budgeting I removed over £100 worth of bills which was a huge help.
My rule is, if I haven’t used it in a month then it needs to go. In November I stopped paying for Spotify premium as I hadn’t used it for months. I now use Youtube and listen to radio stations for music.
In this post I have written in detail about 4 different budgeting methods. The budgeting method that I use is the zero based budget. This means that at the end of the month I am left with £0 in my bank account.
This method is great for someone like me who wants to reign in their spending and increase their savings.
So do some research to find the best method for you.
Step 7: Do a trial month
You are nearly ready to do your budget for “real”, so now it’s time to do a trail month. This is a great way to see if your budget method and expenses work.
Whenever I change my budget I always do a trial month, that way I can have a clear understanding of my spending and debt payoff.
During your trail month, track all your spending and outgoings. This will give you a clear indication if you need to change anything about your budget.
That’s why I would over budget, if you normally spend £400 a month on food shopping up it to £450 for a buffer. Don’t go from spending hundreds of pounds to spending £50 a week on food. The whole point of a budget is to have control over your spending, not leaving you and your family hungry.
You can learn, set yourself targets. If you spent £500 on food one month why not reduce it to £450 the next month? That way you are still reducing your spending without effecting your home life too much.
Step 8: Review
Once you complete your trail month you need to review what you have done so far. Take some time going over your spending and figure out what is going wrong.
I always ask myself these questions when I review my budget:
What went well?
What didn’t go well?
What can I do better?
How am I going to change this?
To me this is the best way to review. For me I was spending a lot of money on meal deals for work. On average I was spending £8 per day on unhealthy food and snacks. Once I realised this is where I was going wrong I started meal prepping which has saved me lots of money.
Step 8: Create your budget
And your ready to start your budget for real!
By now you should have a clear understanding of your bills, expenses and savings. So you are ready to go!
Remember you will make mistakes, you will over spend some months but that’s okay. As long as you learn from your mistakes you will smash your budget!
I hope that this post has helped you have a better understanding of budgets and how to make it successful.
Make sure you check out my previous posts as I am always sharing the tips and tricks I have learned along my journey! 🙂
This past year has been tough for everyone and if there is one thing I have learned from 2020 is how important it is to have an emergency fund!
You never know when an emergency can arise, whether it’s your car or home repairs it can cost a lot of money which you don’t have spare.
2 years ago I was in a car accident, I was fine but my car wasn’t! The repairs on my car cost over £1,000 and I did not have this money saved. Which meant I had to put this on my credit card which left me in debt.
Since then I have learned my lesson and I now have an emergency fund, it isn’t fully funded but I am in a better position than I was 2 years ago.
Unfortunately, no matter how much you prepare you can never avoid emergencies and having an emergency fund is one of the best ways you can avoid using your savings or even getting yourself into more debt.
What is an Emergency Fund?
An emergency fund is money that you set aside for emergencies, this money isn’t used to buy yourself clothes etc it’s for emergencies only!
This fund shouldn’t be used as a long term saving pot, but rather one that you treat as a safety net, so don’t be tempted to dip into it.
During the pandemic my emergency fund has helped so much, I had to get my car repaired a few months ago and having this money available allowed me to pay it off without having to use any of my savings.
I get so many questions about if I think this fund is worth it and the simple answer is yes! When you are starting out on your budget it will help you so much so I can’t recommend this enough.
How much do I need in an emergency fund?
According to www.bbc.co.uk from their report in March 2016, it is recommended that you have between one and two weeks take home pay as buffer. This is roughly £400-£800. However an emergency fund should allow between 6-9 months of expenses which is roughly £1,000 a month. (See quote bellow)
“It recommends keeping between one week’s and two weeks’ take-home pay as the buffer. Translated to the UK, this would mean saving between roughly £400 and £800. An emergency fund should allow for between six and nine months of expense, it adds. If these were to come to £1,000 a month, that’s between £6,000 and £9,000.”
At the moment I aim for £1,000 to cover repairs and expenses on my car. I live at home so I am in a lucky position and I do not need to that much money. However, next year my boyfriend and I are planning on buying a house.
So we are going to start building up our emergency fund in January when we work out how much on average our expenses are going to be.
I would recommend starting small, with a few months’ worth of expenses before you build up to 1 years’ worth.
Where should I keep my emergency Fund? Cash or savings account?
It is entirely up to you! But your emergency fund needs to be easily accessible. Don’t leave it in an account that you can’t access.
My emergency fund is in a savings account in my bank account, I am able to withdraw the money within seconds and use it.
However, you will need to have some self-control and not use it for just anything.
For me this fund is at the bottom of my homepage on my online banking, it’s easy to access but it is not something I can see all the time.
When should I use my Emergency Fund?
The only time you should remove money from this fund is for emergencies, not to pay for clothes, holidays or nights out.
It’s used for home repairs, car repairs and paying bills if you lose your job or some of your income.
It is difficult to decide what an emergency is, but the way I view it, if it’s something that you need in order to survive or get to work then use this fund. But this doesn’t include buying shoes, clothes and makeup.
But don’t be afraid to use it if you need it!
How Do I Save For My Emergency Fund?
The most important thing is to create a plan to decide where you want to start. You need to determine how many months you want to be covered.
The best place to start is with one month, write down all your essential bills and expenses. Once you have this figure you can decide how much you’re going to save each month.
If you have lost your job or have your income reduced then you may have to make scarifies and remove your favourite entertainment subscriptions to pay for your essential bills and expenses.
Essential bills and expenses:
Heating, Water, electric
Insurance (Life, home etc)
Groceries (toiletries etc)
There are many more but this is just a brief reminder.
One thing to remember is that you need to build this fund up quickly, so it may be worth slowing down other savings goals whilst you build this up.
Always set up and instant bank transfer and include it your monthly budget. For my fund I put £100 away each month for me this is enough but I know when we move I will need to up this.
So What Are You Waiting For?
Imagine what it will feel like having a fully funded emergency fund! It is a great feeling, when an emergency arises you will have the money their ready without effecting your savings or putting you in more debt.
I would recommend starting this fund before you starting paying off lots of debt and savings. This fund will give you a peace of mind!
Start small and build up, once you have a month saved work up to a few months and so on.
Have you got an emergency fund? If not what are you waiting for!