Help figuring out money for an autistic adult

[waitandwatch]

I'm really old enough now that I should have this figured out, but I've never really been good with finances and have had many bad experiences with money and debt.

I'm in a relatively good place now and really want it to continue and would like to finally 'understand' money, so please excuse possibly the slightly ridiculous questions.

I've seen online the recommendation for the 50/30/20 ratio in terms of necessities, wants and savings. I've sat and worked out what I have coming in and out and then divided the amounts up into the ratio above.

My question is, what do I 'do' with savings? Do I just keep putting the money away in an account and never touch it unless there's a disaster? Or do savings count as holiday funds, birthday presents funds etc? Sorry if this is a really basic question, I just find it helpful to have 'rules' for what money is for what, but I don't want to have loads of accounts for loads of different changing funds - for example in January my 'wants' fund might be for a new outfit, but then I might need to save three months of 'wants' to pay for a holiday... That idea gets complicated in my brain. So then I think I will use savings as a holiday fund, but then panic when I see the savings amount go down...

Can anyone help with just basic guidelines on what I'm supposed to do please 🙈

I'd say wants includes holidays.

Savings are for longer term things like replacing your car, deposit on a house or unforseen emergencies (eg redundancies, illness).

These days you can get accounts that let you do virtual pots of money to help you partition without loads of accounts.

Savings can be divided up into categories

Annual
Expected yearly expenses eg a holiday, Christmas, annual house insurance bill, car service and mot etc

Short term
Saving for expensive want or need eg replacing the boiler in a few years time, or a once in a lifetime month-long holiday you want to take in 5 years time

Emergency
3 to 6 months worth of extremely basic living costs for if you can't work/loose your job. This should be in a high interest cash account that you can access immediately without penalties

Long term savings
Depending on your stage in life, you might be saving for a house or early retirement. Use a LISA or a stocks and shares ISA. Money needs to stay here for more than 5 to 10 years. Don't touch it

Pension
Workplace or SIPP

The way I thought about it was to work out what my total expected annual expenses were. Divided that by 12 and saved that in a separate account each month. Then I worked out what my emergency fund should be. Opened an easy access cash isa which gave 4% interest and started saving an emergency fund with whatever I had left.

Do you have a pension? If you're not paying into one, then start. As soon as you have £1k in your emergency fund, reduce the amount you're saving there and put the difference in your pension. It will take you longer to build your emergency fund, but compound interest in your pension is important.

Don't worry about the other categories untill you're on top of your annual savings, emergency fund and pension

Agree that an account with pots could be really helpful for you. Then you can split your savings into Holidays / Emergencies / Treats etc and easily see what is where.

Set an amount you want to get to for Emergencies and prioritise that. Once it’s close you can start putting some of the savings amount into Holiday.

Once that’s getting going, you can put a bit into treats etc

The problem is that a lot of the time 'it depends' so while I understand why you want to follow the 50/30/20 rule, it doesn't always work. Especially as, for a lot of people their essentials cost more than 50% of your income, so they can't afford the 30% fun stuff and 20% savings.

It also depends hugely on your circumstances and life stage so it would look very different if you were a 30 something parent with a mortgage and childcare costs vs a 50 something single adult who already owned their home outright and had a good pension. So I wouldn't worry too much about sticking to these percentages. It's more about recognising that you need to anticipate ups and downs in needs and wants, spend less than you earn while at the same time having some leisure money and paying for essentials.

The financial flow chart is a good 'to do list' to follow, so you could aim to 'tick off' each stage. You will see there are two steps for setting a budget, the first when you don't have a lot of spare money or savings or are in debt, with lower fun money, then when you're a bit better set up, you can relax the budget and allow more discretionary spending. Plus of course, it's debatable whether things like a holiday or spending on Christmas is 'essential', of course it's not strictly necessary, but most people would consider it part of normal life - but obviously you have to set the cost at an affordable level, which then effects the category percentages.

https://ukpersonal.finance/flowchart/

As for categorising savings, I wouldn't count 'savings' as anything you expect to spend in the next year, so money for clothes, Christmas, car running costs, holidays etc, this should be seen as part of your budget and you shouldn't expect to see these amounts constantly increasing because you should expect to spend the money within the short to medium term - this gets easier once you've been managing your money like this for over a year - if you start now, you won't have saved up enough for a holiday this year, but you might still want one so either you need to have a cheaper holiday, or 'borrow' from your other savings. But say you have a holiday in June, then from July to next June you can save for the next holiday. You could track money in a spreadsheet, put it in different pots or just wing it - build up a general savings pot that should be enough for things like holidays, Christmas, car costs etc etc and spend budgeted amounts from the pot as the need arises.

Savings are more for if you can't work, or need a new car or home improvements. But here we're back to 'it depends' as the amount you'd need to cover loss of earnings would be very different between someone who is securely employed with good sick pay entitlement vs a contractor who would get nothing if they don't work and has no job security. The amounts you spend on big things is obviously dependent on how much money you have, what is affordable for a car or home improvements.

Sorry that turned into a bit of an incoherent ramble but hopefully it's helpful.

It's a mix really and something that could come with time.

First priority is to save for resilience so this might be so that you can pay without borrowing for unexpected costs but it also might be building enough flex in your monthly budget so that you can buy yourself an outfit one month or have a day trip another month without having to dip into savings.

Then there is annual savings for me these would be regular savings that are used to spend on extra costs throughout the year so could be used towards holidays and birthdays/Christmas etc

Then there are longer term savings and building up a pot that provides you with some income protection. Aiming towards 3-6 months of essentials costs

I'd start by working out what your essentials life costs are annually and divide by 12 to get your monthly costs. Now you know what proportion of your salary is needed to sustain your life. I'd round this amount up by £100 or so that you can accommodate some wants without having to question where it's coming from and it gives you a little bit of freedom in life. This could be in a separate account depending on how likely you are to spend it just because you can see it.

I would then set up a regular saver so money leaves your account within the first week of being paid if being paid monthly or a day or so after a weekly pay.

Periodically review how much you have in your main account and move it into some kind of regular saver. Maybe every 2-3 months ensuring you factor in any annual costs that might be coming up. The bulk of our annual costs are Feb-Apr so we know that we need more in our main account at the start of the year to account for this but by May we want only a small amount of surplus money.

Once you have done this for 4-6 months you will have an idea about what the ratio is for you at the moment and then you can see how you feel about it and make adjustments.

Once you have a bit of a pot of savings you then want to look at what proportion you need accessible and what is ready access. The options are easy access accounts - easy to get money out but interest rates can change. Notice accounts - some access but can be restricted in the frequency - ok if you will only need this money occasionally. Fixed accounts - better rates but money is locked away for 6-24m. Finally stocks and shares - in the short term there might be ups and downs but over 3-7y you should see higher growth than we savings accounts alone.

I tend to do a mix of regular savings, instant access and fixed savings. I'd like to start investing in stocks and shares but up until now I've needed access to the money
I have a regular saver where the money goes out of my account monthly, then an instant access account where any unspent money gets moved every couple of months and then a fixed account.
I generally fix for 6-12 months depending on what costs I thought we would be likely to have. In 2024 we had some building work done and in 2025 we needed a new car so I timed the end of those fixes for when I would potentially need access to those funds. Year on year I have increased the proportion I have in fixed savings I think the current split is a out 65% in fixed savings 35% in instant access. I'm likely to go with something like 20% stocks and shares, 45% fixed, 35% instant access next time the fixed account comes up for renewal

I just recommended Starling to a friend whose young adult autistic son is struggling with finances. But any account with pots will be helpful.

This has been niggling at the back of my mind since replying and have thought of another way of finding out what your ratios and another way of thinking about savings and nice to haves is to think about what you would like to be able to do with your money - what are your life goals? What would you like to be able to do next year that you can't do this year? Where would you like to be in 5 years?
Holiday of a life time?
House deposit?
Once you have done that and worked out you can think about separating out your savings and costs. I've written out a bit of a recipe for how you might work out how much your life will cost and how much will be available for savings and nice things and how to structure things. If it's overwhelming the main thing to remember is you don't have to do it all today! Have a look at the headings and then skip to step 6 which gives some ideas for organising finances if that's all you can manage.

Our ratios have changed over the years. When on low incomes it was 67% essentials and the other 33% was nice to haves and savings. Then we qualified and our salaries doubled but we want to save for a deposit so our essentials stayed the same but was now 33% we reduced our wants a little bit to about 5% (would have been 7.5-10% of we kept the same monetary value) and we were putting more than half our salaries into savings. We I had several regular savers moving £200-300 into each every month and had an easy access account into the best rated easy access account. At the end of the year we had saved about £15k each which with previous savings gave us a deposit for a house. After this we adjusted our ratios increasing our daily bills and nice to haves. Our ratios was roughly 50:20:30 for essentials nice to haves and savings. Once we had a child it was 35:30:25:35 essentials : nursery : nice to haves: savings

If you want a recipe to follow this would be the sort of process I would follow if starting from scratch...

1. Calculate all of your essential costs for the year - go into as much detail as you can. For example if you have a car don't just include insurance and petrol but also the cost of breakdown cover, tax, MOT and service, new tyres and brakes etc.

Steps 2 and 3 are basically making "making life nice" costs and break down into regular little boosts for step 2 and then the less frequent or only if there are funds costs for step 3.

2. Nice to haves as part of regular budget
This might be drinks out, days out, small purchases, day to day clothes, hair cuts etc things that bring a bit of joy to day to day life
Some golden rules for working out the annual costs
x365 for something that is daily
x250 for something that is working days (assuming 5 days a week)
x52 for something that is once a week
x12 for something that is monthly
x4 for something that is quarterly

I would usually include these in my day to day living account but you could have a separate account for this. For anything that is daily - monthly this would probably work but some might find it better to have a pot for things that are monthly -annually

3. Wants -non essential
Same method as above but for things that can if you can't afford you could forego without a drop in wellbeing
This might include presents, holidays, nicer clothes and outfits, big nights/meals out, Christmas spending etc

Something activities that can straddle the two - for example days out... We might have a non-special day out budgeting £50 for parking, an activity and cake and coffee in a cafe. This would be nice to have but ideally once or twice a year we would do a bigger day out it might be a trip to the zoo with lunch £150+ by the time you have accounted for tickets, petrol to get there and back, coffee and lunch, obligatory branded pencil and rubber from the gift shop. Or going to a fancy restaurant for an anniversary at £100-150.

Or it might be to top up the nice to haves. For example if things are good I spent £30-40 per person for my immediate family birthdays and Christmas. If things are tight I drop this to £15-20 for a non special birthday and £20-30 for a special birthday. I account for £150 in the nice to haves for birthday and Christmas presents for 2 parents and 2 siblings with a £100 top up in the non essential wants

Clothes - things worn daily would be in regular budget, outfit for a wedding in the non essential.

4. A life happens fund
In this you would wanting to build up a fund so that if something unexpected happens you have the cash to sort it without having to take on credit.
This would be first to provide a readily accessible fund for unexpected bills or costs.
It might be to replace your washing machine or laptop, a car repair, expensive dental bill or a deposit for a new rental whilst waiting for your deposit for your previous place to be returned to you and so on. You would want to get this above £500 fairly quickly but anything you have in here will provide you with financial resilience.
Ideally over time you would want this to also cover ~3 months of your essential costs.

5. Future Life Planning
What would you like to be able to do next year that you can't do this year? Where would you like to be in 5 years?
Holiday of a life time?
House deposit?
Kit for an expensive hobby you have been desperate to commit to more

6. Organising Finances
From this you should be able to get an idea of how your salary would cover the first 3 steps. From there you want to decide how you "store" your money and then how to keep track of your money

a) Storing
There are a few options for Steps 1-3
Option 1
Get paid into a current account and "live" out of this account. All costs for step 1 and most of 2 are in this account. Have separate account(s) for some of step 2 and all of step 3. This could be lots of little pots for clothes, entertainment, excursions and so on or just one for all "make life nice" extras.
Money for steps 4 and 5 gets moved into a saving account(s)

Option 2
Have one account that you get paid into and use this for the things that make life nice. From here transfer money for day to day life account for all your bills and some of your nice to haves. You then know that what remains in the original account is yours to play with you can filter from their into savings accounts and some of the more expensive nice to haves like holidays

The benefits of options 1 is it's probably easier to set up but might require a bit more active management to work out how much you need to keep in that account for essentials and how much can be filtered away into savings.
Option 2 will require a bit more setting up but it will be clearer what you have left for savings and nice to haves and you can play around with what proportion of the money left you put into savings and what gets earmarked for nice to haves.

Savings: You can get bogged down into what account is best but really what you need is to just do something with it. Regular savers can be useful as it just automatically goes there once you get the standing order set up. The rates for the drip fed money are better than you would get in a easy access account but if you have a lump sum to pay in you would be better off putting it into a easy access or fixed account. Currently you should be able to get 4-5% for an easy access account - check out the money saving expert for the best accounts. That said, if you get decision paralysis and you just want to go with the first bank you come across. It's better to have £1000 in an account at 3% giving you £30 in interest for the year than taking 6 months trying to decide which bank to go with, getting around to opening and transferring the money for a 5% rate as you would then only get £25 for the same 12 month period.

b) Keeping track
It's sometimes easier to keep track of money if it is all in one account as you have one app and it's all there but this is not usually the most rewarding as the bank that gives you the best current account won't necessarily give you the best savings.

We keep a spreadsheet with all of our finances on. We have a page we keep updated with our spends so we know how much we need to put into our living account. We have another tab for savings accounts with the details such as bank name, interest rate and date it was opened and how long the initial rate is. When we have a big savings goal we have another tab where we tot up our savings every couple of months so we can see ourselves getting closer to the target to keep up the momentum

7. Optimising Finances
a) Adjusting budgets
If you find that there's not as much as you would have hoped to putting into savings go back and review steps 2 and 3.

Can you reduce the frequency of some of the nice to haves. A coffee every day is nice but would you get the same pleasure from it being a once or twice a week treat? If you meet someone regularly for lunch out would you get the same by meeting mid afternoon for coffee and cake.
There's a clothes shop that absolutely love as they do dresses in my style, made in the UK. They are £80 new and they provide me with joy when wearing them. Or I could look in their clearance section where I can usually pickup the same dresses for £15-35 for the same joy but a fraction of the price. If I have more cash I'll buy it new or in a regular 10% sale if I'm not I have to keep an eye on the clearance for dresses

Can you drop down on any of your essentials - do you need as much data as you pay for on your phone contract? Do you need the speed of broadband you are paying for? Do you need all of your subscriptions at the same time? Can you go for a "with ads option" for subscription? Is everything you are paying for "value for money"?
Can you drop down a brand for some of your shopping options?

b) Making the most of your money
Loyalty doesn't pay!
Keep track of when you go out of contract for mobile phone contracts, broadband, energy fixes so you can do search for the best deals
Similarly for savings rates usually are higher for the first year and then drop.
Make a note of the dates and then either do them as they come up for renewal... Little and often approach or every 3-4 months review what has come to an end and spend and after switching.... The I'm doing it once and then forgetting about it approach. It comes down to personality and time. I do try to be a little and often person but sometimes life is busy and I only have time as a do it once approach.

You can get paid for switching banks there are a few deals at the moment where you can get £150-250 for switching your current account to a different bank. Some energy providers will give you £50 for sending or receiving a switch request from a friend.

Credit cards - these don't have to be scary, can help build your credit file as well as giving you consumer protection on items costing between £100 and £30000 and some give you cash back on purchases but some caution....you need to pay off on full each month - you can set up a direct debit so this happens immediately and you have to be careful that you are only putting what you can afford on it. We use ours for online shopping and groceries

If you got to the end... Well done!

Thank you all so much for the information you've given me here - I have been slowly reading and coming back to it as it's very very overwhelming and I don't want to fall into the trap of ignoring it all again!

At the moment, I have enough savings that could last me 4-5 months if I were to lose income. I don't currently have a pension, so I think this will be my next step. Not sure whether to do a lifetime ISA or a private pension? I could probably contribute a max of £200 per month to either one, and the LISA would be for retirement, not a first house.

I have also had a rejig of my banking accounts, and have set one to have just spending money. Which I think will help stop me spending just because I can 'see' money in my account.

I'd also like to put £200 a month aside for holidays or bigger house purchases, but maybe this should be more like £150 and £50 a month put into the emergency fund?

What is your employment status and rough age?

I'm late 30s and intend to open a LISA with a couple of £ in so that I have it as an option later. You need to open it before 40 but can continue to use it beyond 40 so if like me you are approaching that 40 deadline I would open one with a small amount.

If you are employed it would be better to join the company scheme /auto enrolment. I think at the moment it's 8% employee and 3% employer at the minimum. You then get the tax back on that as well.
If you are a lower rate tax payer the bonus you get from the government is the equivalent uplift as you get in a pension through the tax relief. If you are a higher rate tax payer then you get more money in the pension than you would in a LISA.

How much of the savings you need to ascribe to different pots comes down to a mindset thing. If you don't have an emergency fund and only have a holiday fund and have an emergency you'll have to take some from the holiday fund. As you have got 4-5 months income in your in case of emergency fund. I would probably first save for holidays, give yourself a target and once you reach that then split the money between the in case of emergency fund and the holiday fund until you get to 6 months emergency.

I listen to quite a lot of money based podcasts. I tend to stick with the BBC podcasts. My favourites are money box and Martin Lewis is podcast. The Martin Lewis podcast is quite a good one as it's part of radio 5 live show with Adrian Chiles who asks lots of questions and Martin Lewis adds extra notes in the podcast after broadcast based on feedback he gets from the episode. There's lots of things that come up frequently so knowledge slowly builds. There are special episodes too including one on pensions so that might be worth a listen. He does talk quite quickly but you can rewind or slow the speed down until you have the in and outs understood

I'm a full time carer for my son so don't have access to a work pension. I'm mid thirties

Ok, don't take my word for it but to the best of my knowledge, it is people in similar situations to yourself that the LISA was designed for although in many cases a pension is a better idea.

How do you process information best? I have listened to a few podcasts /radio shows on Pensions and LISAs, I can share the links if that would help or there's articles on the money saving expert page and similar trustworthy places too.

£200 a month into a pension or LISA is good. You will get 25% uplift in that for both so that's £3k a year before factoring growth, you could have a pot over £60k by the time you are looking at needing the money

Would a pension have more flexibility than a LISA in being able to extract from it in a dire emergency? I have such a fear of putting money into something I can't get back out.

Information wise, I think shorter articles or particularly those with visuals like the flow charts posted above I find easiest to take in, or videos. Thank you for asking this!

The LISA would cost you money to withdraw if you use it for something that isn't to buy a money or pension, this is the biggest downside. I think it's an 6 or 8% penalty. You can only access the money penalty free at 60.
There are also penalties for withdrawing money from pensions so it's usually not advised to do before 55 but you can access it at 55.

How the DWP count the savings might also be a factor. I know that pensions don't count as savings but I think the LISA might.

I'll see what information I can find! I'm out of work and on mat leave so often chained to the sofa with my 3mo. This is all things I've picked up as general interest thing btw rather than my profession