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| Burglar Bill: the friendly face of theft |
Don’t worry, I’m not about to nip round in a mask, carrying a bag marked ‘swag’, to raid your life savings.
It’s more that I was shocked by a news article I spotted yesterday, which reported that more than 16 million people in the UK have less than £100 in savings.
Less than £100!
That’s a whole lot of people without the cash to cope if the boiler blows up, or the car breaks down, or the washing machine gives up the ghost, or everyone grows out of their school shoes at the same time (sore point).
It’s a massive proportion of the population: 4 in 10 people of working age, according to the Money Advice Service, which carried out the research.
So millions and millions of people, 40% of the population, don’t have even £100 to call on in a disaster. Perhaps they have supportive family and friends. Perhaps they have the flexibility to slap it on a card. But maybe, if it came to it, they’d be well and truly stitched.
Saving isn’t only for the loaded
Now, I get that when finances are stretched to the breaking point, saving can be completely impossible. Rent or mortgage payments, childcare and debt repayments can wipe out any spare cash and more. Relationships break up, jobs end, landlords give notice. Without any savings, many of us are a few weeks from the streets.
But to me, the most interesting part of the research was that some low earners can and do save. Apparently, nearly a quarter of working-age adults earning less than £13,500 have £1,000 in savings, and 40% save every or most months.
Makes me think that saving is more of an attitude, a habit or personality trait. Sometimes saving can be possible, even when there isn’t much cash swilling around.
Not spending more than we earn
When it comes down to it, saving is about spending less than you earn. It’s not something that only kicks in once you hit a higher tax band, or fluke that Lottery win.
The Dickens quote from David Copperfield, with Mr Micawber’s recipe for happiness, is a cliche because it’s true:
Annual income twenty pounds, annual expenditure nineteen, nineteen and six, result happiness.
Annual income twent pounds, annual expenditure twent pounds ought and six, result misery.
Grasping that chance of happiness, we need to either spend less, or earn more. To quote a meerkat more recent than Micawber: simples.
Now I don’t search through yellow-stickered short-dated food, or find discount cinema tickets, or raid charity shops, just for the sake of it. I’m trying to manage our money to live within our income, have the most fun with the cash we have AND (and this is a big and) set some money aside for the future.
So coming back to the original question – where do you stand?
Maybe you have a room full of riches, salted away like Scrooge McDuck.
Maybe you’re scraping by, and can only dream of having £100 spare.
Maybe, like me, you’re somewhere in the middle. I’m guessing if you read this blog, about moving to the country, living on less and making the most of it, you probably do take care of your cash.
October savings challenge
I reckon saving doesn’t have to be difficult, it doesn’t have to be boring and it definitely doesn’t have to be all about deprivation.
So I’m setting myself the challenge this month of making small changes each day, in the hope of making a big difference.
Any extra money will help in the run up to Christmas. December is always a financial car crash for us, not just because of Christmas, but because of six (yes SIX) birthdays for immediate family in the month before, including my daughter, son and husband. Presents, parties, celebrations, the whole shebang.
I reckon I’m pretty thrifty normally, but can take it further. There are things I used to do, or don’t get round to, or perhaps of never thought of before, that could all count.
Anyone like to join me during October, to spend less, earn more, and see how it all adds up? Surely we can set aside £100 to combat the cost of Christmas.
Any top tips for small changes that make a big difference? I’d love to hear.
Ah, Allan Allberg's Burglar Bill – remember it well!
3 months worth of income is what they reckon people should aim for saving. Less than £100 is very worrying.
SIX birthdays in December is very bad (family) planning! 😉
Yes, I've heard 3 or 6 months' income suggested as a sensible emergency fund. Just seems quite such a huge aim, compared to all these millions of people who don't even have £100.
And yes the December car crash of birthdays is awful extended family planning. I remember being very frustrated with 'superwoman' Nicola Horlick banging on about having children just before Christmas as a great way to extend your maternity leave. Wish we'd had that amount of choice! Just glad to have children at all really.
We save £200 every month or more if we can. But I know lots of ppl how don't have £100 in the bank.
Thanks for commenting Mr Pickles (and Sue!) I reckon it's a great idea to have a set amount in mind each month for savings. Otherwise it's all to easy to think "I'll save depending on what's left at the end of the month", and then somehow there's never much left!
Yep; this is very worrying on so many levels. One, is that were something to happen these people go straight into debt – a lot of it. Usually, what we'd hear is that people don't have enough to be able to save. I've long believed that saving is a matter of mentality rather than immediate possibility. Our whole culture has become 'immediate'; think about fast food and movied on demand. We have forgotten how to plan for the future.
Thanks for reading and commenting Maria! Yes, like you, I do wonder if saving is more a matter of mentality than income. Suspect someone who is inclined to save, or inclined to risk spending more than they have, maintains that attitude regardless of whether they're earning loads or just a little. I also despair about the constant need for instant gratification, rather than looking long term. There's such a culture of consumption, encouraging people to define themselves in terms of the things they buy, rather than seeking happiness in the things money can't buy like relationships and experiences. Savings can free people up to make choices and enjoy life, not stockpile stuff.
I saw this report and found it frightening, it is little wonder there is growing demand for food banks, with so many families so close to the edge!
I know it's almost the end of October, but we've been really disciplined with keeping our heating off or low throughout the month. This is less for Christmas and more just to keep bumping our savings. I really need to work on lowering our phone and broadband, so that's my next way of trying to keep hold of a few more pounds each month.
Do you think you'll have managed to save an extra £100 in October?
Hi Sarah –
Heating can cost a bomb, can't it? We've been using extra layers, hot water bottles and the wood burner in attempts to minimise switching on the central heating. Good luck tackling your phone and broadband, definitely worth doing. Earlier this year I saved about £150 on our broadband & phone even without the hassle of switching: https://www.muchmorewithless.co.uk/2016/04/broadband-how-to-save-without-switching.html
It's looking good for the extra £100, from a combination of all the small changes. Fingers crossed for the end of the month, although fear I'm going to be writing it up for a while longer!
I took part in a CAP money course with the Hadleigh Baptist church, really turned us around with our spending. We could never figure out why, when we should be comfortable, we were living in (sometimes over) our overdraft. We discovered we were not planning the yearly costs in. I can heartily recommend that even the most thrifty out there find out more about it!
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