What financial advice would you give to someone who's living alone for the first time?

[uninvitedcat]

I'm going to be moving out from my parent's home in about 2 months and would appreciate any general advice . I've never had to budget before and it's a little overwhelming.

On a more specific note if anyone has the knowledge to answer - what's the best thing to do with savings? Stocks etc seem risky, but then 1 or 2% return on savings accounts seems worthless.

www.moneysavingexpert.com/savings/savings-accounts-best-interest/?gclid=EAIaIQobChMIwsqFv6LQ1wIVkbobCh182w9uEAAYASAAEgKYmPD_BwE&source=GOO-0X0000042AADF61376&gclid=CjwKCAjwjbCDBhAwEiwAiudBy6bfTR0Qy_Sj1YgWFAs-71Y2FwRZpiZ0hSVgU5CG_9jCYUR_1XZOUxoCV6MQAvD_BwE. Do yourself a budget. The current savings situation is heartbreaking but I have my slush fund in Zopa which is a peer-to-peer lending platform paying c. 3%. Relatively easy access.

Write a full list of bills, work out how much that will be monthly and leave it in an account with direct debits coming out to pay the bills. Have a separate account than anything left over goes into and you know you can spend or save that. I have my wage go into one account which the bills come out of and have two other separate accounts with spending money in one and savings in the other.

Do a proper detailed budget, there are some good websites and templates online. Make sure you include everything, it's really easy to miss all the small stuff that adds up! Decide if you're saving for anything and include that too. And put aside a little every month for unexpected emergencies. Enjoy your new life and your independence!

Budget annually first. If you start by month or paycheck you will always find yourself playing catch-up because real life doesn’t follow that schedule.

I have no financial advice but YOU WILL BLOODY LOVE IT!!!

If everyone can, they should live by themselves for some time. It’s absolutely bloody amazing, such a nice thing to do. So enjoy being entirely selfish for a while, doing things exactly your way and being able to leave your dinner plate out / loo unflushed at night etc etc etc

Thank you all! I appreciate the tips and I'm definitely looking forward to the joys of living alone.

For a budget I've worked out my income after tax and then included rent, bills, insurance, food, council tax, pension payments and student loan repayments. Am I missing anything? I'll be getting around by bike so no need to calculate transport costs

Definitely write down all outgoings. Each bill seperately, as someone said, it is so easy to miss/forget one thing!

Include presents, repairs for your bike or appliances in your budget. Have a short term fund for unexpected expenses.

Look at the money saving expert budgeting advice for a comprehensive list.

Remember to save for annual and irregular expenses. Don't worry about interest, you won't get much but you need money put aside. Stocks and shares are no good for short term savings.

Regulary check your broadband and gas and electric costs to get the best price.

Make sure you can feed yourself cheaply unless you have loads of money. Ready prepared food whether from the supermarket, or takeaways, fast food etc is far more expensive than making your own food so a good way to make your money go as far as possible.

Get the MSE weekly email for ongoing tips about making your money go as far as possible.

Make sure you keep your bike securely, even if it's inside your house, living room etc, or get a proper bike garage.

Landline if you get one for broadband, mobile phone if you don’t.

Work out how much your bills are and have them coming out of the account you get paid into; then once they’re all paid put the remaining money you have into a different account so you know how much money you have for the month; I also have accounts where I move savings into and also savings towards a holiday or something big I want to buy.

Are you taking everything else out of your monthly 'disposable' income that's left over after those costs you list? Clothing, footwear, toiletries, prescriptions, glasses or contact lenses, haircuts, coffees/meals out with mates, any subscriptions such as Netflix etc, mobile, holidays, weekends away, cinema, gym membership, hobbies, sports, days out, etc etc etc?

At least for the first few months record every penny you spend so you can understand where your money goes. There is nothing wrong with splashing out £100 on a piece of clothing you love if you can afford it but you need to know how ot affects how much money you have to spend on other things. If you normally spend £50 on food a week and choose to live on beans and toast for a month to afford those shoes that's fine but be sure it's a conscious choice rather than finding out on the 20th you have no money left for food.

Definitely a really detailed budget, include everything - subscriptions, Netflix, everything. Workout what you have left and then save as much as you can without leaving yourself short. Set up standing orders for your savings and ‘pay yourself first’ so you don’t tell yourself you’ll save whatever is left at the end of the month, because there never is any

I would say do a meal plan too, maybe a fortnightly one so you a) don’t get bored and b) can write a proper grocery list and the stick to that budget. Include breakfast, lunch and dinner and snacks!

I second recording everything. I have a paper budget and update it once weekly as I’m paid weekly BUT if I have a particularly spendy period where I feel like it’s getting away from me, I update it every night. There’s something about writing it out by hand that makes it all seem real.

I have three accounts (and a joint one with OH, but that doesn't matter here) - my main account, that my salary is paid into and all DDs/standing orders come out of, a day-to-day spending account, and a monthly saver that can be relatively easily accessed for emergencies.

I also have a share ISA, pensions, some bonds and a long-term savings account, but as it's your first time living alone, I would recommend that you build up a year's worth of easy access savings first, before you start tying cash up (houses/cars etc have a habit of breaking at unfortunate times).

If you're in a good place next year, you can then start thinking about reinvesting half or two thirds of what you've saved?

Also consider what setting up costs you’ll have from moving, for example furniture/bedding/towels/kitchen equipment etc.

As others have said there’s some really good tools online and scrutinise your past spending and look at the discretionary spending especially. It’s easy to underestimate what you spend on things that aren’t really essential.

If your budget shows you'll have enough left to put some into savings, do that at the start of the month, not the end. Saving "whatever's left" at the end means you'll be more likely to dip into your surplus rather than saving it. Also, if you can, set up a monthly savings account to build a reserve for bills that are one-offs: house insurance if paid annually, replacements to big appliances, Christmas, etc. Anything that takes the stress off the monthly salary.

You have not planned for mobile phone contract, water rates, TV package/Netflix etc birthday cards and gifts, stamps, Xmas, going out with friends, collections at work or clothing. Cost put everything, stick to.your budget, have a contingency fund in case something breaks.

Another thing that you need to budget for (which you might have included in your food costs but it’s not clear) is cleaning equipment and cleaning products. A friend recently moved (split from partner) and suddenly realised how expensive it was to get basic kit like bucket and mop, dustpan and brush etc.

@CatNamedEaster

"If your budget shows you'll have enough left to put some into savings, do that at the start of the month, not the end. Saving "whatever's left" at the end means you'll be more likely to dip into your surplus rather than saving it."

This is brilliant advice.

Water rates
TV licence
Broadband
Emergency fund
Holiday fund

Try and arrange to have all standing orders and direct debit bill payments set up for the beginning of each month, around 3rd-7th. That way you don't get caught out by a big one getting taken out near the end of the month, just before you get paid.

I have all utilities coming out as direct debit as soon as I get paid
Another good thing that helps me budget is I actually pay my council tax over 12 months instead of 10. Makes the monthly payments a bit lower than they would have been

If you are going to be living alone ask your council for Single Adult Discount when you register for council tax. It will save you 25%.