to think most people don't have savings?

[horseyhorsey17]

I realise this is going to get a whole range of different views and experiences and I am interested to hear them all, but I recently read some research saying that most families in the UK have less than £600 in savings. This got me wondering - I am a single mum with two teens and a mortgage, and I don't have savings as such but I do have a private pension (had it for nearly 20 years now) that I pay roughly 5% of my salary into (as well as a work pension) and I overpay on my mortgage. I consider this a more effective use of my money than saving, which I can't afford to do as well. Do most people have pensions AND savings? Or neither?

Just really curious as I spend my salary every single month and all my friends do the same. That might be just my peer group! I suppose I could save if we never went on holiday - but I'd rather have the holidays tbh. You only live once and you can't take it with you, etc etc.

I think not having savings but spending on luxuries (takeaways, holidays, new clothes, Netflix, new furnishings) is like building a house and buying expensive furniture before you have installed windows!
I know the cost of living is tough right now but that';s even more reason to "scrimp and save" so there is always a cushion to fall back on.
I recommend making a budget:
page 1 - total net income.
page 2 vital unavoidable expenses eg rent, heating, food, transport to work (and look to see can this be pared down at all).
page 3 disposable income - then categorise that into eg clothing for adults, clothing for children, shoes for children, toiletries, replacing household goods, car repairs/insurance/tax.

Monzo savings app has "pots" you can use to allocate your income into these sorts of categories. Then you will not mistakenly spend on luxuries things that you might need next month for vitals like bigger shoes for children, or sanitary towels 😂. This method also helps us see where we are actually spending, and where we can cut back. And you can make a pot where as soon as you are paid, x amount goes straight into car repair pot, y amount goes straight into children's clothes/hoes account, and z amount goes into rainy day fund. If you can't keep those pot topped up then buying takeaways and holidays seems a bit risky.

IDK if you have children, but they get more expensive as they grow. Little ones need nappies and toys and endlessly bigger shoes. But young adult offspring need much more pricey things like driving lessons, cars, university fees, rent, house deposits, and weddings - (weddings are another topic entirely it can be done for £3K we did it!)! Would you not like to be gradually building up a pot to help them with those things?

Our modern culture tricks us into confusing necessities with luxuries, because there is profit to be made by selling us dreams like new cushions and earrings, and no profit to be made by telling us to go for a country walk and take a picnic. Life can be cheaper than we think.

Ways to save on necessities:

Potatoes, rice, onions, beans and spices bought in bulk.
Cook from scratch using what's on offer.
Drink only tap water or tea. Really, this can save £££s.
How many outfits do we really need?
Invite friends for baked potatoes in our home instead of an evening out. Instead of a Netflix account, play charades or fishbowl, read library books.

I don't think I ever bought new furniture except beds and mattresses, and my home is beautiful - second hand can be gorgeous and environmentally healthy too!
I do spend more on footwear and waterproof coats because these make for comfort and wellbeing. And I do buy new underwear and PJs, but for years everything else was second hand and really cool! As well as environmentally responsible.

It really can be truly rewarding to live like that. We did for about ten years, then as savings grew and salary grew, we gradually became more financially secure and NOW can enjoy more luxuries - with some left for the future too - than we would have had we spent it as soon as it came in.

sorry it is so long winded.

I’m single and under 50, self sufficient kids. I have tiers of savings, a years rainy day salary in accessible accounts, full premium bond holding, 2 houses 1 of which provides a modest rental income and seven figures invested in a pension. No debt or mortgages and very minimal outgoings ie £400pm

I suppose I could save if we never went on holiday - but I'd rather have the holidays tbh. You only live once and you can't take it with you, etc etc.

I have an elderly relative who lived like this with her husband. She is now widowed, living on a basic state pension in sheltered housing paid for by her children (who, as a result, can't save for their futures) She has said with hindsight she wishes she had foregone some of the spending and planned better for the future.

I have a small amount of savings which we can’t add to at the moment due to cost of living. I also save child benefit separately but this is to go towards bigger costs such as new car seat, clothes or school trips.
Ideally I would like a small amount in short term savings and a larger one in an ISA. Plus some premium bonds

We have a small savings pot (circa 5k) and we add 200 pm in.
We have workplace pensions each and 1 private pension.
We have another pot which I put money into across the year to help with bdays and Christmas.

We can't really afford holidays atm and use our salaries every month - however we do currently spend £1200 pm on nursery so once both children are in school hopefully things will improve! I think we would up the amount we put into savings, and start to over pay on mortgage

Personally I try and save a lot of my income.
But that's because I rent and I'm hoping that things in life will come my way one day.

I live in a flat with the cheapest rent so u can save more.
I save towards a house deposit, I save towards my pension, I save for an emergency fund (which is there incase anything bad happens as a cushion).

I save towards other things like holidays and gifts, but this goes. Because I spend it so I don't see it as saving in the same way.

I spend my income in rent, then bills and food, and allow a buffer for life incidentals and a bit of shopping/weekend money.

But i dont have a car yet, I don't have kids, I'm not engaged, and I don't own a house. I'd like all those things one day. Plus a cat. So I'm just trying to save a good amount towards those. Hoping that they'll be a possibility.
I would also like to go on a long hike some time, and take a month or two off work to have an adventure. So that's saving up for as well.

I'm quite 'behind for my age'. As I had a lot of illness in my 20s. So I am trying to compensate for missed income. I would have been able to reach my goals more gradually had I been working for longer. But instead it's quite an aggressive approach I'm taking so that I hopefully don't run out of time.

If you've already got kids, car, house, marriage, good credit score. I imagine you'd want savings incase you lost your job or became Ill. Or something in the house needed fixing. But then people get loans. I don't know.

I find it comforting to have a bit of savings so I know if shit hits the fan, I've got my own back.

I have to say you are doing really well. You ARE saving. You are paying extra on your mortgage, into a work pension AND savings for your kids. Honestly you are smashing it. On top of that you are having life fun too with your kids, they are only young once and you are making the most of that plus savings in the ways that you are. Well done you.

Sounds like you are doing an amazing job financially and you are definitely saving. We are a dual income household and we both have roles that pay reasonably well, which clearly makes the financial situation easier. My husband is the primary breadwinner in our house, his earnings cover food, rent, utilities, running the car, uniform, clothes, extra curricular activities for the kids. I work less and do more of the childcare, but still have a role that pays well, 15% of my income goes into a pension, the rest is either saved or spent on luxury things like holidays. We travel quite a lot, it's a high priority for me and I would say are pretty frugal when it comes to other spending, the car is > 10 years old with no plans to change it. We are renting in the UK but have a house overseas we bought 13 years ago, and the tennant's are (slowly) paying off that mortgage. Our savings were bolstered by money I was left by my grandparents when they passed away. We are definitely very fortunate.

I'm a single Mum. I save probably obsessively. I have a low income, but have set up several savings accounts for different things; 'oh shit', holidays, Christmas and birthdays, school stuff for my daughter, home stuff, daughters isa. I put £5-10 each in these per week, and have done for years. I also have 6k which came from the sale of my marital home when we separated. It was money I didn't realise I would get above what I'd accounted for, for the deposit on my home. It's in the 'absolutely never touch' pile, until my mortgage comes up for renewal, and I will add it to my deposit. In the meantime it sits in a savings account.

Since day one on my own, saving was a must and I cut all other spending to the absolute minimum. I have nobody else to ask for financial help I'd never countenance asking my parents for help if I needed to pay for repairs in my car.... so I've saved like a daemon. I've also skimmed off of my current account at the end of the month, if I've had anything left, have been paid a bonus, or overtime etc, and that has always gone straight into savings. I'm getting a pay rise this month and have set up a direct debit to take that amount straight into savings. I can't miss it if I didn't have it.

You’re a single mother with a mortgage, pension and kids and still able to manage on your own and go on summer holidays! I’d say you’re rocking it !

I save a lot every month and I have a public service pension but also pay into a private pension because I plan to retire at 60.

I don't overpay on my mortgage but my housing costs are low enough to feel insignificant at €515 a month and I live in Ireland so there's no large council tax bills to worry about on top of that. We bought our house in 2016 when it was worth less than half of what it is today. If I was still renting or trying to buy today in the middle of a major housing crisis I'd be in a much much worse position, just luck really.

Also we don't have childcare costs because my husband and I work different hours and grandparents child mind for free (at their insurance) on the days we overlap. Again, just lucky. If we had big mortgage repayments and childcare bills we'd probably save far less.

I overpay my mortgage and pay large pension contributions because I like to see growth and get tax back.

I don't save into a traditional account. I have never been out of work so think it is unlikely I will need a few months salary.

House repairs are covered by a large sinking fund (I live in a flat and manage the freehold).

I assume that if I need money for something I will just spend a few months not overpaying mortgage or pension and quickly save some money.

This has worked for last 25 years! May not last forever.

We have no savings, we have decent ish pensions, equity in the house, and high earnings (albeit we do manage to spend everything every month….). We spent around £3k a month on a mix of holidays, weekends away, eating out, all sorts. So if we had something like a boiler, would just spend less that month.

We have private school fees which stop when uni starts so no need to save for that, as we will just swap one expense for another.

We absolutely should be more financially responsible however we had the kids very young and my stance is I’ll save when they’re grown up, we will still be under 40 at that point and until then I want to enjoy their childhoods to the full….

I think whether or not you stay married is key to your financial landscape.

There's lots of "we have this" and "we have that" but if you end up getting divorced it all has to be split.

I have some savings, pension, 5 years to go on the mortgage and do go on a lot of holidays but if my ex hadn't thrown in the towel we would have paid off the mortgage and been retired by now.

He was a terrible saver though.

Are you not worried about one or both of you getting sick and not being able to earn or do you have good insurance for things like that?

Also, marrying the right person. Generally, two incomes are far better than one, and being single is ridiculously expensive (I'd have at least an extra £1000 a month in disposable income just from splitting my mortgage and bills), but someone who is bad with money can ruin your own financial stabiity. My friend's partner is dreadful. He pisses away money on absolutely nothing - crap like several takeaways a week, pints after work multiple days a week, new trainers he doesn't need, going to the expensive corner shop because he can't be arsed going to Tescos - and then he'll tell her they're broke and they can't afford a holiday. The poor woman hasn't had a holiday in five years, even though as a household they earn far more than me and have similar expenses. She'd be better off single.

Excellent insurance and also sufficiently high value of things that we could chop out immediately that we could comfortably be ok (we own relatively expensive ponies and pay more for their livery and expenses than our mortgage for example - we could always sell them and the associated kit, transport etc and have multiple tens of thousands of pounds rapidly). I can’t say I don’t worry because I do (about the level of spending) but not that we will ever be unable to pay our bills or afford our retirement.
We also have work related investments that will mature and provide passive income in a couple of years (equity stakes in things). This is probably a large part of the reason for the way we are - I don’t want to have more money than we can feasibly spend, right at the time the kids start leave home and we have little to spend it on….almost everything is on the kids’ hobbies, education, experiences with the kids.

Are you just talking about no instant access savings pot, or do you mean absolutely no savings at all? Our cushion in the instant access grows and wanes, and sometimes it’s empty if we have a lot of things we need to buy or pay for at once. We do have other pots going as well, though, so that’s not our only savings. We have defined benefit pensions, a work-sponsored high interest savings scheme to which we contribute 12% of DH’s salary each month (we can access that either when DH turns 55 or when he leaves his job, whichever comes first), and a 3 month emergency fund in an isa. We don’t feel very flush on a day-to-day basis, though, because the funds aren’t really accessible. It’s forcing scarcity, basically, so that we don’t end up with too much lifestyle creep. I often feel like we have ‘no savings’
when the instant access is empty, but the reality is that we could dip into the emergency fund if we really ran into trouble.

Can I be nosy and ask what you do to have such an expensive lifestyle, having had your kids at such a young age? It seems quite unusual!

@TeamGeriatric Your bank balance may be full but your morals are sadly lacking to be getting your tenants to pay off your over seas house.

My maths is out too 🤣
I will be mid 40s when youngest child is an adult. Not 40, sadly!

I am also a single parent with a teen and don't manage to save much. I save for specific things like holidays, extra curriculars, and unexpected expenses, but I don't have a pot of money growing by the year. I think as others on the thread have said, it's much harder to save on a single income. Plus like the OP, I want to prioritise having fun with my DC while they are still at home. When they are financially independent I will be able to live much more frugally, but this is our chance to have experiences and fun together.

We are absolutely skint due ti the cost of living crisis, and have exactly £112 in our savings account. If we have a big bill ( boiler, car etc ) we would have to beg from elderly parents as the credit card is at its maximum.

We are both professional people earning a decent if not big wage for the part of England we live in, but bills and mortgage increases have made our lives almost unsustainable.

I'm sure that really depends on your social circle, most of my friends live on a council estate and are living hand to mouth and in shit tons of debt. There's not a chance any of them are sat on £100k