Things I Didn’t Do To Save 10k In 1 Year
Saving £10,000 in a year is difficult, especially if your salary is below average. This doesn’t, however, make it impossible! Your decisions around what are typically your largest expenses can have a massive impact on your savings. These vary for everyone, but housing and travel are usually at the top of the list and can be the difference between saving a few pounds and a few hundred pounds per month. By making clever financial decisions, you could save the most money you’ve ever saved in 1 year. Here’s how I did it:
1. I didn't move out of my parents' house
Whether renting or paying a mortgage, housing is typically the largest monthly expense covered by a person’s paycheck. By living with my parents, I was able to avoid this expense entirely.
When I started my graduate job, I was really tempted to move out because it seemed so normal! Many of my friends and colleagues started renting as soon as they finished university, so as one of the few people who didn’t, I felt like the odd one out. Despite this, I decided not to follow the majority. I really wanted my own space, but it wasn’t worth the financial consequences of renting in London on a basic salary.
I am very lucky to have parents who let me live rent-free at home. They are supportive of my goal to purchase a house and are happy for me to use my money to save for a house deposit (rather than paying them rent). By living at home, I was therefore able to save a significant amount of money that I would have never been able to save if I had moved out. This was definitely the number one reason I saved over £10,000 last year.
2. I didn't purchase a new car
When I was younger, I used to dream about purchasing my first car. Then I purchased my first car and started dreaming about purchasing my second. Then I purchased my second car and started dreaming about purchasing my third—no surprises here!
So, when I finally found myself on a stable income, I was extremely surprised at myself for making the decision not to buy a new car. Again, it was something I had seen all my friends do. They got their first real jobs and treated themselves to a brand new luxury car. Now that I’ve got a real job, why shouldn’t I do the same?
And that’s when I realised why buying a new car doesn’t align with my long-term financial goals and would be a completely unjustifiable purchase. My 2009 Ford Fiesta works perfectly fine. It is reliable, cheap to run, and cheap to fix. It completely fulfils my main reason for having a car, which is convenience. So the only benefit a brand new car would provide is “image,” which honestly isn’t worth it.
Yes, I do think it’s important to treat yourself from time to time, and yes, I do want to drive a more luxurious car one day. But right now, I’m focused on saving money and building wealth, and buying a brand new car is not the way to do that. If I did buy my dream car, I would have nowhere near as much money in my savings as I do now.
3. I didn't say yes to every birthday, special occasion or outing
Birthdays are when I spend the absolute most money (one of the downfalls of being the life of the party). Last year, I got invited to so many birthday meals, birthday holidays or other types of birthday events that I decided to turn down.
Turning down birthdays or any special occasions I’ve been invited to is really hard for me. A lot of the time I’m very grateful to make the guest list and really want to show up as a sign of appreciation. However, last year I decided that if you’re not a close friend and I’m not completely comfortable with how much money I’d need to spend, then I won’t attend. And trust me, by simply missing a few birthdays and special occasions, I was able to save hundreds of pounds. Not just on the event itself, but also on things like travel, clothes, and presents.
So yes, I might not get an invitation to their next event, but that just means they’re not someone I should be friends with. If they were, they would understand why I can’t fit their birthday into my budget for the month. Regardless, I was able to save £10k in one year, and that’s what counts, right?