1. Know your finances.
Create a cashflow forecast in something like Excel and each day keep track of all money coming in, and money going out plus the balance of your account. Do this at the end of each day for money you’ve received and money you’ve spent. On the same spreadsheet, track money due to come in and go out in the next 30 days. This gets you very present to money and what you focus on expands. It also shows you where any danger zones are – so you’ll know in advance if you’re going to struggle to pay a particular bill and you can therefore take action before it happens by cutting unnecessary expenses.
2. Treat saving money as a game.
Make it fun and get the whole family involved. Give it a name, for example Austerity Measures, Money Magic, Money Matters. Make it short-term – for example, the next 3 months. If we think we’re going to have to scrimp and save forever it can get very depressing. But looking at it over the short term, say 3 months – then it’s much easier to make changes. See it as an adventure rather than a hardship – you might not enjoy camping but it’s fun to experience once in your life.
3. Look at all your outgoings and see where you can make savings.
What subscriptions could you do without for 3 months? Are you eating out a lot, getting coffee on the go – could you cut these for 3 months. Could you do something at home that you’d normally get done professionally? Could you share lifts and cut fuel costs? Be as ruthless as you can – remember it’s only temporary. And you might well discover that there are some things you can really live without forever.
4. Get conscious of where your money is going and be very discerning where you choose to spend it.
Much of what we spend money on is a habit – we do it without thinking. For the next 3 months, for every transactions ask yourself “do I really need this? Could I leave buying it for another few weeks?” If the answers is yes, don’t buy it.
5. Choose fun things to do that are free or low cost
There are lots of free places to go throughout the UK – find those in your local area and visit them. As the weather warms up picnics are great fun. Play a game where each family member has to come up with 10 free or low cost things to do, and choose a couple to do each week.
6. Save First
Look at your cash-flow forecast and if it looks like you’ll have some money left over before payday, put it in a savings account that’s not linked to your main current account. You want to have access to it, but not be able to see it each day. Put it aside as soon as you receive the income, not at the end of the month. If you try to do this there won’t be any left as our outgoings always expand to fit our income. By putting it aside first it protects our money from ourselves. Make a pact that you’ll only spend it in an emergency. Having savings to fall back on gives you peace of mind.
7. Generate More Money
Are there any ways you can supplement your income? Do you have a skillset that others would pay for? A spare room you can let out? Brainstorm all the ways you could generate income – some will be nonsense but there might just be a golden gem you can test out.
8. Celebrate and appreciate every windfall
No matter how small the windfall or gift is, appreciate and celebrate it. We are often given gifts that go un-noticed or unappreciated because they’re small – maybe it feels like a drop in the ocean. However, what we appreciate accumulates – and the more we appreciate the little things, the more gifts will come our way. I’ve just changed my daughter’s mobile phone tariff, saving £11 a month. Included with the tariff is a free gift – I could choose between a 3 month subscription of Audible or Disney+. It just so happens that there’s an audio book I want, so I’ve opted for Audible. I’m very appreciative that I can now listen to it for free and save another £7.99 – especially as it was on my list to buy. When we don’t appreciate the little things, why would the universe bother to give us more?