If I’ve learned anything this year, it’s that money is very important to me. I know that sounds materialistic but in order to live, we need money. In the past couple of years, I’ve gone from full-time work to freelancing to part-time retail and finally back to freelancing. It’s certainly been a rollercoaster and I’m glad that I’ve finally been sorting out my finances in 2020.
I always used to be a saver but then I became a spender so it’s time to get on the saving train again! I actually like seeing my accounts increasing, knowing that I’m saving for something in particular.
This year, I got myself a budget planner from Wilko and it has transformed the way I think about money. When you commit to recording every penny you spend against every penny you earn, you soon see that you really shouldn’t be spending that much money on absolute rubbish.
At the end of every month, I highlighted and categorised every purchase and totalled everything too. That is the most eye-opening part. Obviously, you might have an emergency (my laptop died this year so it was a necessity to replace it) but most of my spends are small and regular. By categorising your spending, you can see if you can cut back anywhere.
I’ve enjoyed using a budget planner so much in 2020 that I’m going to be using one in 2021 too. I’ve already got mine from Wilko again and have started to set it up!
NO SPEND DAYS
I’ve never really been one to set a budget as I’ve rarely had a consistent income, working mostly in retail and now freelancing. Instead, I’ve just tried to spend less and less over the years. This year, I decided to challenge myself to at least 20 no-spend days a month, 25 if I could. Luckily, when it got to late March and lockdown and I was only working 1-2 days a week, it became a lot easier!
I also found that if I made a shopping list, I’d buy from a couple of places in one day. If I’d already broken a no-spend rule that day, I might as well continue it. However, my spending has dramatically reduced this year. I’ve decided to spend less online too and deleted my bank details from all but a couple of websites.
I no longer make impulse purchases; in fact, I save up for every big spend. This year, my laptop broke and because I had an emergency fund set up, I was able to use that money. Setting up savings pots for every expensive item means that I will buy it when I need it, rather than when I want it.
I’ve done a mixture of standing orders, savings challenges and round up pots to seperate accounts. Sometimes I have an idea of the amount I’d like to save, sometimes I just save small and regularly, like £10 a week or £5 a day. Most of the time, you don’t even notice the money leaving your account, it’s that minimal!
I’m always on a mission to expand my knowledge and self-development is something I’ve really worked on this year. Reading finance books and other people’s experiences is a great way to pick up new tips or think about things differently.
REGULAR MONEY MEETINGS
If you don’t sit down regularly and go over your finances, you need to. It should be at least monthly but I like to record income and expenses every day. Then at the end of the month, I review it all. I like to know what is going on with my money. If there’s any problems with any of my accounts, I know straight away because I’m on top of all transactions.
CHANGING MY MINDSET
I’m now more future focused, with less spending on material things and more of a focus on savings. However, I still impulse spend but lots of little amounts (Kindle books are my weakness)! Changing my mindset from a spending to a saving mindset has been a huge shift but it’s definitely worth it. If I want to own my home in the next couple of years, I need to save as much as possible!
AREAS FOR IMPROVEMENT
My journey this year is by no means perfect but I’m super proud of the amount I’ve been able to save so far. For 2021, I want to keep moving forward and saving with less small spends and budgeting for bigger spends. After sorting out my finances in 2020, here’s a few areas I want to focus on in 2021.
- More no spend days
- 21 items for 2021 (clothing)
- Project Pan on all toiletries + beauty products
- Savings challenges into Monzo pots
It has been a year but a good one for me in terms of finances. Sure, I’m not rich or have the highest income but I’ve started to appreciate the money I do have a whole lot more. Sorting out my finances in 2020 has been a ride but it’ll all be worth it when I see those saving pots rise!
Have you been saving or spending more in 2020? Do you feel like you have a hold over your finances or are you a massive over-spender? Leave a comment below or come and chat on Instagram.