Welcome to Money Matters: GLAMOR’s weekly dive into the world of finance – your finance. These uncertain times have reminded us of how important it is to understand our money and yet… how little we talk about it and how much secrecy it is.
It stops now.
Eager to break this taboo about money, we discuss everything related to personal finance, from money saving tips to ISAs and pensions. Each week a woman in a unique situation will give us an honest breakdown of her finances, and our expert will give her simple advice on exactly how to tackle it. So have a cup of tea, sit down and let’s talk money …
I work in commerce with £ 45,000 a year but have always felt financially helpless. Now I want to learn about money – where do I start?
Abby * is a 24 year old recruitment consultant from Kent. She takes a pay cut for a job she is most passionate about but worries about how she is going to budget for her lower pay. Here is his silver diary.
I am a recruitment consultant – so far I have recently taken a new job in a completely different industry with less pay. I was looking for a career change and I managed to find a new job as a family assistant, which is what really excites me. However, with the drop in wages, I worry more and more about the money.
I’m a spender, not a saver, and I find it incredibly difficult to stay on a budget. I’m going to overspend and withdraw money from my savings to pay the outgoing bills at the end of the month. My family was never good savers either, so I was never taught about money well. My partner earns around £ 15,000 more than me and is SO good with the money. I’m afraid I’ll never have enough money to provide for a vacation, a family, and God save my car if it breaks down.
I recently passed my driving test and my old car did not allow me to reliably get to work every day. I needed a decent car, so I had to take out a loan of £ 3,000, which I pay back £ 85 each month.
I’ve calculated my new salary and all bills (and savings) are covered, but I’m worried because I’m spending, I’m worried about the effect it will have on my savings and therefore the effect it will have. on my later life.
What can I do to do better? Any help is welcome!
How to keep tabs on your money for better financial well-being, if you feel like you are not in control of your money
Current account: 0.12p (can’t wait to get paid!)
Savings account: I’m trying to save £ 100 per month (so far I’ve only saved £ 160 🙁
Annual salary: £ 25,000 per year before tax; (no advantages or bonus); £ 19,064 after tax
Monthly pay: £ 2,083 and after tax I get around £ 1,589. I have no other income.
Invoices: £ 481 for the bills (my partner covers the mortgage and I cover the bills)
£ 150 for common expenses (food purchases etc.).
£ 370 per month for the car (including the cost of the car, taxes, gasoline and monthly insurance)
£ 60 for the phone.
Weekly budget: All of my spending leaves me around £ 75 a week to spend however I want.
Car loan: £ 3,000, which I pay back £ 85 each month.
‘Covidflation’ has seen the cost of living skyrocket, while our wages stay the same – here are some tips to cut costs
MY MONEY THOUGHTS
My worst money habit: Spending too much and then dipping into my savings because I’m not on a budget.
My biggest money worry: How am I ever going to afford beautiful things in the future that I want?
My financial hopes for the future: Stability and not living off a paycheck!
Current mood for money: 😠 😟 🤬
£ 1,481 on invoices – that’s a lot of money. Unless you’re hiding cheeky memberships there or have a membership to the craziest gym in town, assess where that money is going. If you haven’t changed your utility recently, use a service like Take care of my bills that does the job for you. If you are paying for all the streaming services under the sun and paying a hefty sum on your phone bill, it might be time to do a little evaluation and compromise.
2. Less inside, less outside Navigating a pay cut is not easy. Old habits die hard and to be honest, less money means less money. My advice would be to make the changes before you start your new job. To do this effectively, you’ll need a new spending plan (a budget that doesn’t sound boring). First, check your expenses (see point 1) then indicate the subject of your paycheck. You have three categories: goals (savings). You’ll want to automate them every payday. Then, with what’s left, your needs (bills, car payments) and wants. Consider what would be a realistic% for each category.
3. The time of the show With a draft spending plan drawn up, put it to the test. It may be helpful to keep your needs and allowance needs in separate “jars” or accounts. Keep in mind what you have to spend each week and use smart open banking apps like Yolt, Cleo or Emma to find out where your money is actually going and what you are spending it on.
4. Night rendezvous If you have a partner who is brilliant in the money business, use him. We are all jealous. Have conversations about finance, ask them for their top tips, and if you’re comfortable with that, set up a financial meeting every month. Pour yourself a glass of something and take 30 minutes to review the month with your financial hat: Did you save what you planned? Is your spending plan realistic? And what’s coming next month? Having someone to hold you accountable is a game-changer if you find it difficult to save money.
5. Future planning When it comes to your future, whatever your budget, we are all limited by what we earn. No amount of trimming or couponing will increase your income. This is where career choices, promotion planning and related activities come in. It looks like you’ve taken a good step in jumping into a more satisfying career, so once you’ve settled in, look for opportunities to progress. This will give you a better idea of your earning potential and while you are at it, make the most of your employer’s pension!
Alice Tapper is the author and founder of Go finance yourself. For more money tips and advice follow her @gofundyourself.
This column offers advice, not financial advice. For personal investment advice, it is always best to speak with a financial advisor.
* The name has been changed.
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