Saving as much as possible or enjoy life a little?

[Namila]

Hi all!

I was wondering what approach other mumsnetters take when it comes to savings.

Assuming you are in a lucky enough position to have spare money at the end of the month, do you prefer to save as much as you can or save a little and spend a little? Or save nothing and spend it all?

In an ideal world, what % of your income would you like to save?

I'll start with my two cents:

I try to save 1/3 of my income each month. Sometimes I hit that number, sometimes I don't. I could save more than that if I lived more frugally and cut on some small treats, but I find that hard to do. So I take the approach of "save a little, spend a little".

When I think about it I feel a bit guilty though, knowing that I could save more and I don't

Curious to hear other people's thoughts on this!

We put money into a pension, a share scheme and a couple of investements. Save a bit for short term savings (Christmas, new boiler etc). We have a separate budget for things like days out/meals out/treats.

I don’t really know what it is as a proposition of income, I don’t really think of it like that as some comes out before we even see it (pre tax) etc.

*proportion

We save regular amounts, monthly savers for emergency funds, pensions. We're also saving for an extension next year. We do live though. We don't go out very often anymore and cook at home instead, and we really consider buying things before spending, but we don't scrimp every penny so we can save it. We're lucky that we have a good disposable income so can do both.

It sounds like your approach is absolutely fine and if you’re saving a third of your income, that’s very good. I manage similar and am careful, but don’t beat myself up about the occasional indulgent purchase.

I don’t save much at all, but I have a mortgage which will be paid off one day and a public sector pension if I work for another 37 years so I’m not too worried about day to day savings.

We save £600 a month. Approx a fifth of our after tax income. Some months we can save more. We are lucky to also be able to afford modest treats without saving less.

I'm self employed and my earnings vary from month to month so I can't put away a set amount but I do try and put a couple of hundred into an existing savings account where I can.

I have little, short term treats like eating out or the occasional clothes shop but I can never bring myself to spend my savings on bigger things like holidays - I'd rather have a good buffer of savings in case of an emergency than splash it on an "experience". I don't budget though, I could save more if I stopped doing things like buying lunch every day instead of making my own. So I suppose I'm somewhere in between the spend or save mentality

I'm very much an ant rather than a grasshopper and wish I was able to spend more without feeling guilty. Security is very important to me - I've brought DD (now 20) up with no maintenance at all from her father, so was always conscious of being a one income family and needing to save for any unexpected periods of low or no income (and have had several of those). My aim was to pay off my mortgage as soon as possible, and to save half my salary per month when earning.

Live with half
save half
after paying all bills

have no pension to speak of
but no debt either

clearing down debt is ALWAYS the priority

I have no mortgage so it's a bit easier for me. I pay 20% of my gross salary into work pension (for the tax and NI rebates, plus employer pays 5%, plus they also add in the employer NI saving as well, so any savings I do I may as well do that way really) and then save £550pm into regular savers (2x, one with Nationwide and one with First Direct).

I then try to save another £500pm but as I moved house in the summer I'm not really managing that, I have had to buy a lot of house stuff, carpets, furniture, decorating etc.

I work partly on self-employed work, and partly on short term employed contracts. My current contract ends in April but I am going to try to finish it early (it's really boring!) so for that reason I also keep c£7k for living expenses between jobs/between payments.

I've gone through phases, a few years ago I was set on saving £1k pm (as well as pension) and I did for ages, and I got my savings up significantly, partly how I managed to buy my house with no mortgage but I also have significant savings which bring in c£3k pa income.

I have no kids, btw, so that obviously makes a huge difference.

But I am not frugal - am lucky enough to have a decent income and even after all my savings and set outgoings I still have discretionary spending money that means I don't need to worry about new clothes or a few dinners out each month.

Bit of both. We save an amount for rainy days, some for Christmas and house improvements or school trips and then have fun with some. Life is short and we have fun and enjoy life a little.

Interesting... I would like to know what percentage of income the big savers in the thread... save for the long-term (i.e. Pension, investments, kids uni fees etc) versus the percentage of income saved for emergencies / holidays etc.

We typically invest 25% of income, save 10% for emergencies and holidays, car maintenance etc, spend 20% on meals out, days out, 'treats' and the other 45% is food and bills... no mortgage, so that makes our bills sound really expensive!

I have 1st world problems. Want my 20 month son to eventually go to private school when he's 11. Gonna cost £13.5k at todays rates. I need to figure out a way of getting that without dipping into my earned income when the time comes.

This means I need to be frugual and invest every spare penny we have for buy to let properties and investments. We still have an annual holiday and eat out several times a month - gotta live too.

I'm a saver by nature. I don't enjoy splashing out on stuff I could do without. When I nice things, I dislike the buying experience but my parents taught me money is for spending so I force myself to.

I am not someone who spends whatever money they have so I just concentrate on what I'm spending and what is left is my savings. I don't like budgets. If you save £500 a month, what happens if you get to the end of the month and have £200 left in your account? Are you just going to piss it away on stuff you don't really want just to get rid of it? I have a rough idea how much I want to save in a month on average but it varies a lot.

For the last year we have saved about 2/3rds of our income. We have medium income and low expenditure. We have done it because we are expecting income to fall and expenses to rise in the near future. There's no point saving like that indefinitely if you're not saving for anything.

I have only spent on stuff I need. "Need" is always relative. I could save more if I had to but I'd consider 1 holiday a year and a meal out once a month as basic rather than luxury spending.

I spend, mostly on holidays or experiences. Life is short and my children will only be small for a few years.

I love the fact that people think of saving as first world problem

The opposite is true.

If you live in a continent with no reliable healthcare
no pensions
no unemployment benefits
no reliable power
then savings are an absolute essential

Africans and Asians find the short sightedness of Europeans absolutely shocking.

One illness within a family - hospitals / transport / time off work / extra food -can bankrupt ten people

I work more hours so I have less time to spend and when I do, I can spend more because I can earn more (through promotions, bonuses). There is also more left over for saving.

Better to concentrate on bringing in more income (if you can, of course), than on cutting costs.

If you save £500 a month, what happens if you get to the end of the month and have £200 left in your account? Are you just going to piss it away on stuff you don't really want just to get rid of it?

Err no? Why would you? For most people, budgets are a guide. The amount I budget to save is a minimum amount. Anything left at the end of the month then gets allocated to another savings pot (usually short term savings).

If you have money left in your account at the end of the month you just leave it there to roll over for the next month or move it into savings. It's not like they take it off you if you don't spend it.

I jut spend what I earn. We have some savings, pension etc. I do worry occasionally about money, but apart from the mortgage we are debt free. Life is for living and we have a good time

I used to manage to save £500 per month, but with a drop in pay and childcare costs whatever I save tends to get spent eventually (on my car, on special days out etc), and so long as I don't break into my buffer I'm doing ok. Once the kids start costing less (will this happen?!) I can save more...

Chienrouge I just don't understand where the numbers come from.

The same goes the other way. If you get to the end of the month and are £100 over budget on food, how to you know you have "overspent" and not that your budget was £100 too low in the first place.

I think it is better consider in real time whether my purchases are worth it and whatever they add up to at the end of the month is what they add up to.

Well I don’t know where other people’s numbers come from, but I know where mine come from.
I make a list of all my ‘non negotiable’ outgoings; mortgage, gas and electricity, council tax etc. Then all my ‘discretionary but regular’ commitments (sky TV, gym membership etc). Once all regular expenses are accounted for, I dedicate an amount to go into long term savings (pensions, investments) and an amount to go into short term savings (Christmas, holidays, new kitchen etc). Whatever is left is for food/petrol/days out/treats. It’s easy to assign a number for food shopping as I can see from past months what I usually spend. This is my food budget. Ditto with petrol. I then have an amount left for days out/treats/make up etc. If I don’t spend it all, I carry it over to the following month or add it to one of my savings pots. If I don’t have enough left for something I want to buy, I wait until next month.
Works fine for us.

I think it is better consider in real time whether my purchases are worth it and whatever they add up to at the end of the month is what they add up to

That’s fine if you’re good at managing money generally. Some people aren’t. Some people are on very tight budgets and need to account for every penny to make sure they’ve got enough left at the end of the month. Some people have no disposable income at all.