Getting your finances sorted takes planning. That’s why they call it financial planning. Most people are only one pay day away from getting into financial difficulty but it doesn’t have to be that way.  It’s January 2020 and people in the UK are taking up a money challenge to try and save around £660 in a year. I believe the details are that on day 1 you save a penny (£0.01), day 2 = 2 pennies (£0.03 in total) increasing until day 100 then it’s £1.01 until day 200, then £2.01 increasing to day 300, then it’s £3.01 increasing to the end of the year. Some people will be able to manage this, for some it will definitely be a struggle. They don’t call these things challenges for nothing.  It’s amazing how many people live beyond their money every month. Sometimes this might be because you are on a low income whereby the money you receive barely covers the essentials. Sometimes it’s because the temptations of modern life are too hard to resist.  Where there is only yourself to consider any changes that you might want to make in your spending habits can be easier to make. If there are 2 or more or you there needs to be a joint agreement to do this or any plan might soon hit the rocks.

It is true to say though, if you want a different outcome you need to take different action. Let’s say we have a couple who want to buy their first house. This is a good example to use in that there is a defined purpose for wanting to save. Any good reason might be used. The fact that the reason exists means that there is something to aim for, an outcome, a desired result. Money is like work. Work expands to fill the time available, and you will always find things to spend your money on unless you have it earmarked for something else. Following certain rules means that making your money go further is easier to do.

I don’t know who first coined this phrase as I have heard it from so many different sources. And the more you come across the same thing then it becomes proof that it obviously works. The standard figures for starting out is 10% of your net income. Now, this in itself can be a culture shock. If you can’t survive on 100% of your take home pay, how can you survive on only 90%? Remember I said that in order to have a different result you need to take different action. The first reasonable action to take is to look at the last 3 months bank statements. If you can download these into a spreadsheet it will make the job easier, or you can enter them manually. Take a look at where your money disappears to. Most people you ask have no idea where their money goes and while this remains the situation, nothing will change. However …… there is a record of your spending. It can be traced if you go through the exercise. So do it.

What you are looking for is areas of spending, groups of things. Some things will be essential and cannot be avoided. Mortgage, rent, council tax utilities to name but a few. Others might have gone up year or year without being looked at: house insurance, car insurance. Mobile phone bill. These are some areas where savings might be made. What about subscriptions: clubs, television, Netflix? Only you can decide if these are needed but, if you want to see a change, you have to make a change. There are two ways to be rich: 1) make more money 2) desire less things. Here is a question for you. If you spend less time watching Netflix would that give you time to start a new business from home, on the internet? Could money on a gym membership be saved by going for a run in the park? Or exercising at home?

A great way of saving money to look at the money you spend on food and eating out. Everybody needs a treat but, if you were to look in your shopping trolley at the end of the shop what would be in there? All raw food, fruit and vegetables? Convenience meals? Premium brand sauces and snacks? Cakes, biscuits? If you were to analyse the shopping receipt what would be essential? What could you trim in order to save 10%?

At the end of the day, if a full 10% can’t be saved the first time that the expenses are looked at, can 5% be saved? The important thing is what you do with the money that is saved. It is absolutely essential that this money is removed from the account that all the bills get paid out of. As a minimum it is good planning to have at least 3 separate savings accounts. None of these attract any interest to speak of and none of these will give any growth. Money on account will only lose value over time, once inflation has been taken care of, so it doesn’t really matter which account you open. This is just a mechanism for separating your living money from your saving money. Once savings money starts to accumulate we can look at what can be done with it but, for now, we just need to remove it from the account that you have ready access to. This should be done by opening up the savings accounts and paying money into each of them each month by standing order, in equal measures to zstart with.

Why 3 Savings accounts? One is for your “Freedom” pot. This money is never to be touched. It can only be used to buy investments once the balance has reached, say, £1,000. Once is for your unexpected items that crop up such as a car breakdown, and the last is for you to save up for things that you know you will spend but never seem to have the money for: car insurance, holidays, Christmas. All the things you know you need but never seem to plan for.

The money you have coming in from your salary is only one part of a financial plan and it’s the only part that the majority of the workforce have. Again, it doesn’t have to be that way. With the present economic environment and wealth of learning available online, starting your own part time business online has never been easier. Click here to learn more about one opportunity for making money online


  1. Download the last 3 months bank statements into a spreadsheet
  2. Identify areas where savings may be made
  3. Open up 3 different savings accounts (if you don’t already have them)
  4. Calculate the savings you will make and split them 3 ways
  5. Set up standing orders to each of these savings accounts
  6. Start to look at alternatives ways to build another income

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