To think most people could save a small amount regularly if they prioritised it?

[BoldRubyShaker]

Obviously there are people in genuinely difficult situations who simply don’t have anything left to save and that’s not who I’m talking about. But for many workers, I do wonder whether saving even a small amount regularly is more achievable than it’s sometimes made out to be. Even something like £50 a month builds up over time - around £3,000 over 5 years (plus interest) and much more over the long term.

AIBU? I think that for a lot of people it’s more about prioritising than possibility.

I actually think the OPs post comes across as the complete opposite.

Nowhere has OP mentioned a house deposit... they've mentioned £3k in 5 years. Which yes doesn't seem like a lot, but it is definitely true that when people who ordinarily don't have savings see it build up even little by little it really gives them a boost. Seeing £600 ring fenced at the end of a year isn't going to make you scream "I wish had that latte last Friday".... people are more likely to think "Oh I'll push for £1k" and so on. IMO.

Honestly, I just don’t know how that can be the case.

Single people I can understand how they might struggle single people with no safety in it or no parents to help definitely
Parents of little children are in quite a decent position. You get paid more than they need for most of their primary school years at least which is a good opportunity to save for the secondary school if they’re in adult clothing and shoes the pendulum swings.

It should be a balance. Save a bit, but also treat yourself too.

Well yes, some could. But to use your example I'm not sure that cutting out all of life's small pleasures to have £3k in five years is all that attractive? I mean, it's hardly a life changing sum is it? For people to go without the reward needs to be worth it. No ones going to be financially secure with £3k nor even £30k if they scrimped for a lifetime. So i can understand why they wouldn't bother.

Why do you care what other people do.

Saving might be right and it might be wrong too.

Nobody knows what we are actually doing here on earth.

Yes, in general, although I would suggest if struggling starting with £25pm, and shifting it to savings on payday. Increase the amount saved if /when any pay rise is ever received, aim for saving 50% of the rise.

I think I would exclude people on mat leave / at their peak of highest stage of paying nursery fees / mortgages, at that point I might expect many couples to be drawing on savings (hopefully built up whilst both working FT with lower outgoings).

If you literally do not spend a penny on anything that isn't essentials and are living pretty much on the breadline then you are not who OP is referring to. They went to the effort of specifying "most" people rather than "all" and clarifying that they understood some people "don't have anything left to save."

But in the same breath you say you could "cobble together" a hundred pounds a month. That's £1200 a year. If you saved that (and to be clear I'm not saying you should), that would cover loads of different things - either 'proper' treats like a mini break away, or unexpected problems like car repairs, shower/toilet stops working and needs an emergency plumber, get locked out and need to call a locksmith, etc. Even with something big like a new boiler, surely it would be better to put £1200 towards it and £2000 on a credit card than having to put the whole amount on credit, be charged interest and then have to panic and claw it back by cutting down.

Like the PP who said they didn't see the point in saving because it ends up getting spent, I just don't get the logic of 'if you can't save thousands then it's not worth saving anything."

I can see this point to be honest. I’d also add to this that if you’re saving your last £50 every month then realistically you wouldn’t have £3000 after 5 years because it’s incredibly unlikely that you’d make it that 5 years without ever having to touch those savings. If that’s your last £50 and your washing machine broke, oven, car, any unexpected bill would immediately be coming out of that money so you’d have even less.

Exactly. It's like the beginning of Up. I think that's fairly normal.

Eh?

When I was a single parent on a low income I started saving before I spent - having unexpected expenses filled me with fear so I had pots to put money aside for various eventualities.
Although I am now in a much better place financially I still always put my savings aside as soon as I have been paid.

I think any amount in savings is worthwhile, as surely even a few hundred pounds will be useful if an expense comes up? Yes it would be gone if a new washing machine is needed, but what are you buying the washing machine with if there was no £600 savings there?

You are allocated the same amount of money when your baby is three months old as you are when your child is 15 3/4
They work on the assumption that you are getting enough to keep Keeper 15-year-old and three4 alive
But actually, you only need to keep your three month old. Who may even be breastfed but the nappies would balance that out.
So that could be your opportunity to get ahead of the game financially and save the money that you are not spending on the three month old, but are still being allocated

Is that not the point of saving, so that you can afford to replace these things when they go wrong?

Do you not see the benefit of being able to just buy a washing machine out of savings when needed without worrying?

If you don't bother saving when you could and your washing machine breaks, then you need to borrow, possibly at high interest rates or go to the inconvenience and expense of the laundrette.

In the beginning, it's not about building up huge amounts of savings, it's about having financial resilience so your not financially stressed when a predictable expense arises.

The financial flow chart explains budgeting and saving. In the first step, the budget is modest in terms of fun spending, as the priority is building up resilience. But it does allow some fun spending, so it's not like people can't ever buy a coffee etc.

The UK Personal Finance Flowchart - UKPersonalFinance Wiki

Then later on, when no debts, and a better savings, you can increase your discretionary spending. So people with significant discretionary spending but no decent emergency fund, are skipping ahead, so likely to trip them up sooner or later.

For the inevitable whataboutery, we are talking about the majority who do have spare money available for saving and/or spending.

My grandma saved every 20p she ended up with in her purse. It would pay for her summer holiday every year. Amazing what happens when you take care of the pennies!

I'm not sure you understand how finances work...

Overall, I think it is just shit to be poor. The people who can't afford to put very much if anything away to cover a broken boiler or washing machine, are also likely to only be able to access expensive forms of credit.

Whereas, although I'm not rich, I can comfortably save over a few months to cover the cost of a new washing machine. But I also have companies tripping over themselves to offer me 0% interest credit in the shops, or 0% interest credit cards etc. So if I had no savings, I could get free credit instead.

I think the sad fact is the people who would benefit the most from saving, are those least likely to be able to afford to do so.

I think one of the issues is the wide variety of things regarded as essential today and the justification for spending large sums of money every month on things that are not needed. See also the justification on this very thread that £50 a month - £10-12 a week - is 'not worth' saving because 'all' you will end up with is £3,000.
So on the one hand, people are evidently so stretched they cannot possibly find £10 a week, yet on other hand, £3000 is nothing. Which is it??
If MN is to be believed, it is entirely normal to drive big new cars (safer for the children), eat out regularly, entertain the children with 'experiences' like soft play and theme parks routinely (I work so hard i should be able to afford these,) have regular holidays (family time is so important), and so it goes on.
Like the OP, i absolutrey agree some people are stretched. But not all.

And then its taken even further when celebrities, who are paid well enough to be able to afford almost anything they want, get constantly given loads of luxury stuff for free, that even "normal" people who are doing fine financially would struggle to afford/justify!

Yes, but it avoids debt

We have a bank account for the dog!
Both put £25 in each month then when he gets an expensive vet bill it isn’t such a shock.

Only if you can afford to treat yourself. Some people can't afford to have this balance and it's important to acknowledge this. Treats aren't an entitlement.

I said I could save.
Those examples like going on holiday were to show that we don’t live extravagantly, not that we are “on the breadline”. We aren’t by any means.
I was trying to say that I just don’t think it’s worth the stress and giving up the small day to day luxuries I do have in order to save enough for a few days away or half a washing machine etc.
We budget for emergencies as best we can, pay into pension and insurance so really what’s the point in saving?

@Dollysleftnipwhat about horrendously expensive childcare?

What about it ? Low earners receive a percentage towards it.