To ask how people built up savings of £5k to £15k?

[ThatOpenPoet]

For those who’ve managed to build up savings of around £5k, £10k, £15k - how did you actually do it in practice? Was it consistent monthly saving, cutting back, a one-off boost or a mix of things?

I would like to hear what realistically worked for people rather than just general advice.

Thank you.

Now this would just lead to depression tbh. You have to be able to have some sort of Treats. One thing at least

I think you misunderstand…it’s not like normal benefits. Child benefit is for anyone who doesn’t have a parent with an income of more than 60k (I’m being very loose with the rules) it’s not the same as universal credit.

F

Yep, this is how I did it. I've got £20k in my Stocks and Shares ISA but have only contributed £13k of my own money, the rest is investment growth.

I opened it with one of the robo advisers (Nutmeg, now JP Morgan) during the first Covid lockdown, stuck a lump sum in there and have paid £125 a month into it ever since and left it alone. Separately I have my emergency fund kept in premium bonds as I aim not to touch my ISA unless of dire emergency.

Like others have said, there's no big secret and the reality is saving money is just consistent and boring. I have direct debits set up at the start of the month to treat my savings like one of my other bills and then I have to make the money I have last.

I think the idea that we need to spend money on treats is what leads to poverty, and misery. Appreciating a sunset or time with friends, as well as financial security, are the real treats in life.

Of course money is for enjoying, and there's no point hoarding it with no end purpose, but the idea that everything valuable (treats) has a financial cost isn't helpful or healthy either.

Consistent monthly savings and putting money into a savings account as soon as you get paid. But also saving more on months when you can, so adding money to a savings account at the end of the month. Shop around for the best price when buying things. Try to forgo or limit small purchases that add up - things like coffee, buying lunch, takeaways, drinks at the pub. Everyone has priorities when it comes to spending so cut down on things that aren’t a priority for you. Get a savings account with a good interest rate. It makes a difference, especially when you have thousands of pounds saved. I would say that it’s easier for some, than others. I didn’t save for years because I lived in London on a very low wage and I simply didn’t earn enough to do so. I think perversely when you CAN save, you are more inclined to limit silly purchases like coffee, lunches etc as you can see a tangible difference in your account.

There is balance to be had though

When I was a single parent, savings were treated as a bill and diverted on payday. When in an abusive marriage however, my savings paid for wedding, holidays, house deposit etc even though he earnt more than me.

A variety of things. 👍

Since 2024 you can have two 60k incomes and still receive it, but that furthers your point.

The key thing is being financially aware. Have a proper budget set up so you know how much money you have coming in and out, and then you know how much you can save each month, and then it just gradually builds up.

Saving small amounts adds up. Just look at my credit card bill .

Regular savings go in on payday. I work overtime in my main job and bank work at a private hospital. DH works a gig economy job on top of his regular job. It’s usually not the lattes and avocado toast stopping people saving, it’s thinking 37.5 hours is the absolute limit you can work. Tbf the tax and benefits and student loan systems are all set up to make more work pay less (we use pensions when we are over the 40% limit).

Consistently saving and investing in a global tracker ETF inside an ISA.

YY to consistent monthly saving.
When I first started work in the early 90s it was £12.50/month. I’ve upped it over the years, reduced it when childcare and mortgage ate up most of our income, and upped it again as these expenses reduced and salary increased.

As others have said doing it first is key because you’ll always have some reason not to do it if you wait till the end of the month to see what’s left. Definitely need to listen to my own advice on that one!

In terms of where to save a stocks and shares ISA is brilliant.

All money is budgeted. Saving done on payday. Two sorts - proper savings and then another chunk for annualised expenses that then get paid out of savings pots. Try and use cashback sites - then that money goes into savings rather than being spent.

Also utilising free / low rate credit. Eg I got a balance transfer cc for 3 years. Instead of paying credit card off from bank at the end of the month I did a balance transfer and put the money in savings pot. One off fee of 3%. However that money is sitting in a cash isa earning 4.5% a year for 3 years. I pay the minimum off each month which comes out of my savings pot and will pay the rest at end of the interest free period.

also done the same
previously with a purchases 0% card

if anything offers interest free credit while still being a competitive price I utilise it and pay off over interest free period. Money sits in my savings in the meantime.

money away for annualised expenses bills really helps - if you can create that pot it saves money long term as you can pay everything upfront and not pay more by doing monthly - eg all insurances.

In terms of where to save a stocks and shares ISA is brilliant.
Aren't they a bit risky compared to a cash ISA?

Consistent saving. It goes out on payday and never feels like my money. After a while the s+s ISA reached a point where it just grows without me putting anything in which is amazing.

I have an amount I need in my account to get through the month, and any that I have in my account over and above that on payday goes into savings.

Stocks and shares ISA. Even if you only put a small amount of money in each month, the cumulative interest really builds up over time. Mine is making about 20% at the moment.

Like others, SO into a savings account on payday. Small enough so that I shouldnt need to use it - so expected expenses like car needing work on its MOT come out of current account, not long term savings.

Plus, half of any bonus goes straight in.
And any payrises - half of it gets added to the savings standing order.

We do not have holidays, a new car, a new sofa or eat out at expensive places.

I get paid on 15th and DH gets paid at the end of the month. Whatever is left from each pay cheque is transferred to savings when the other person is paid even if it is only £50.

Move money in as soon as paid, loved frugally and transferred anything left at end of the month into savings.