Saving guidance for someone who has never saved before

[kuopo]

I'm in my 30s, never had any savings, due to a combination of reasons, but essentially boiling down to not enough money to do so, lots of min wage jobs and some life events, that have meant debt. So I have never had to look into any kind of savings options or best practice, as I have never been in the situation of even having £20 in savings.

I have a loan (5 years but manageable to combine previous debt), and I'm about to start a new job, which is a higher wage, and means I will be able to put about £800 into savings a month, sometimes maybe more.

What do I do? I've read that, the most important thing to do will be to get a 3 month wage supply, so that's going to be my focus, but after that... do I put in ISA, government bonds, just in a savings account?

MN-ers generally seem to have it together when I read financial threads when people do the threads on how much savings people have, so I am hoping to get some guiding wisdom! Very excited to finally get some savings.

I've recently asked AI to help me plan my savings. Told it what my loans are, what my income is (as I've recently started earning a lot more), worked out when my next big tax bill is going to be (Jan-28) and what it's likely to be, so I know what I'm working towards.

Currently the plan is that at the beginning of every month I set aside the money I'm putting towards my tax savings. I'm also building up an "emergency" savings fund (that will be 3 x months' worth of living costs plus an annual holiday) and a car deposit. That money gets transferred out straight away too.

Once that's built up, anything that will then left in my bank account at the end of the month will be used to make capital repayments against some business loans I have.

In your case, I would do similar - build savings to a point that you've got a buffer and then start making lump sum payments against your loans if your agreement allows.

This might mean that your loan repayments reduce automatically, in which case, continue to top up the difference each month, which will continue to reduce the loan quicker and quicker.