Broke Girl in the City contacted leading debt charity Stepchange last September, to offer guidance on a number of topics, to share with you all as part of our ‘Money Mondays ‘series.
Living with debt can be very stressful. Most of us are in debt in some form. Student loans. Bank loans. Re-consolidation loans. Credit cards. Payday loans. Sometimes the pressure of debt can get a bit too much.
New Year. New You. Spring clean your finances
January is the perfect month to spring clean your finances. So I thought it was time to reintroduce my Money Mondays series.
Looking back at this time last year, my finances have improved so much. I FINALLY paid off my 25k Lloyds loan. I also managed to pay off one of my credit cards this month. Just by leaving the card at home always and upping my minimum payments over a 4-month period to clear it.
However, there are a few things, which has set me back. I could write a book on what not to do in life and that includes personal finances. My Achilles heel? I tend to spend money on eating out and drinking during stressful periods.
5 ways to save money in 2019
So let’s kickstart the year by looking at 5 easy ways to save money in 2019.
1. Track your spending
I can’t stress this enough. Using a spending app for the past year or so has shown me when my spending is out of control in certain areas. It has been useful to categorise my spending. So I know how much is coming out of my bank account in rent, credit cards, loans each month. Then I can see how much I spend eating out v shopping, entertainment and going out having fun.
Saving is impossible when you are broke living and working in the city. However, from someone who spent most of their working life not saving. It’s best to save a small amount each month than nothing at all. One of the best things I did in 2017 was to save £25 a week into a savings account. It doesn’t matter if you get paid monthly. You won’t notice this amount leave your account – just make sure you leave enough in at the end of the month – and it builds up over time.
Have you ever heard the phrase death by a thousand paper cuts? Most of the time this is what is happening to your finances. How many cans of coke or lattes do you buy yourself over a month? How many times do you choose to eat out at lunch because you can’t be bothered to make anything or go to the supermarket? Even going out for drinks a couple of times a week starts to add up over time. So look at how much money you spend on Ubers and lattes…and cut back. Ask yourself can I make myself a coffee at work? Buy a cheaper lunch? Believe me, if you stop spending £25 on small items, you can then free up your finances to start saving this instead.
One of the things I tend to do is sign up to things and forget all about them. So something I do at the beginning of each year is to look through the direct debits and standing orders going through my account. Subscriptions to things can burn money each month, so cancel anything you don’t need anymore. Make sure nothing is coming out of your account unnecessarily.
Why not also take the time this year to declutter your life too. Sell unwanted items for money. I am currently putting clothes items on Shpock
Money was never really a priority for me. Probably why I was always broke. When I first arrived in London I took out a number of loans and credit cards, trying to keep up with the lifestyle that my contemporaries were leading. We would often go to bars in Soho where a round of drinks was my week’s budget for food. I felt that I had to fit in and further my career by developing these relationships. Debt was just a by-product of choosing a career in London.
You forget that your money mindset can also be driven by emotions and stressors. I know that during stressful periods in my life, I tend to eat out more as I don’t have the time or inclination to cook for myself. Unfortunately for my bank balance. I tend to also go out more regularly with work friends drinking too, to counteract the stress.
2019 should all be about how to build a positive relationship with money. At the end of the day, money gives us options. We can go on holiday. Meet up with friends. Whatever motivates you, set goals for yourself. Make sure this year you start to cultivate a money mindset so that you can thrive rather than just survive this year.