How much have YOU got stashed away for a rainy day?
How much have YOU got stashed away for a rainy day? Meet the doctor who would be broken by a faulty boiler and the music manager who couldn’t sleep without a cosy nest egg
Nikki Ramskill, 33, qualified as a hospital doctor nine years ago
The doctor who would be broken by a faulty boiler
Nikki Ramskill, 33, qualified as a hospital doctor nine years ago and is currently training to be a GP in Bletchley, Bucks, where she lives with her partner, Tom, a civil servant. She has just £1,000 in savings. Nikki says:
Although I earn a decent wage, currently £36,000 a year and due to go up to £46,000 in August, my outgoings — including repaying the £50,000 debt I ran up while doing my medical training — wipe out most of it.
As well as the three-bedroom house I share with Tom — we split the mortgage (which is in his name) and bills down the middle — I also have a flat in London which I’m struggling to sell, and, therefore, am paying two mortgages.
So, saving any more than a basic emergency fund of £1,000 has been impossible.
But I’m determined to build up a much bigger safety net over the coming years to ensure that something as simple as a broken boiler won’t plunge me into further debt.
I spent far too much on travelling in my 20s. However, I haven’t taken on any new debt for almost three years and am using every spare penny (including any overtime I do) to clear what I owe.
I’ve become quite evangelical about it, to the point of setting up a website as The Female Money Doctor to share tips about managing money and tell others how to avoid making the same mistakes as me.
Over the next couple of years I plan to save £15,000 — the equivalent of almost six months’ income — which I will keep in a high- interest bank account.
Monthly Income: £2,700
Monthly outgoings: £2,523.50
Mortgage: £750 for flat plus £550 towards house
Doctor-related costs: General Medical Council licence, £43.30, Royal College of General Practitioners, £33.25
Eating out: £50
Utility bills (including council tax): £71.50
Insurance (excluding cars): £25.45
Mobile phone: £35
Car costs: £105
Debt repayment: £450
Holidays (annual cost divided by 12): £83
Christmas and birthdays: £42
Lily Canter, 38, a lecturer, lives in Market Harborough, Leicestershire, with husband, Mark, 44, a cabinet-maker, and children Byron, five, and Ivor, two. The family has £30,000 in savings
The lecturer who took in a lodger and saved
Lily Canter, 38, a lecturer, lives in Market Harborough, Leicestershire, with husband, Mark, 44, a cabinet-maker, and children Byron, five, and Ivor, two. The family has £30,000 in savings. Lily says:
Until two years ago I was earning a full-time salary of £50,000.
But we worked out that by cutting back on travel and childcare costs and taking in a lodger, we’d be better off if I went part-time.
So now I earn around £30,000, and my husband a similar amount. Yet in the past year we have managed to transfer £10,000 to a savings account.
Ever since I started work after finishing my English Literature degree, aged 21, I’ve put away money each month.
In fact, even as a teenager I would save my pocket money, rather than fritter it away on clothes and CDs like some of my friends. My parents gave me a 21st birthday gift of £6,000. But I didn’t want to just blow it on any old thing, so it wasn’t until three years ago that I finally spent it — landscaping our back garden.
I didn’t even borrow anything for our wedding: I enjoyed the challenge of saving every penny for the £8,000 we spent on our big day.
I managed to put away £500 a month from my wage, which was then around £24,000.
All of our child benefit now goes into savings.
I like knowing that even if one of us was unable to work for a while, we have a good buffer. Having only £6,360 in savings — the average that most people have — would not feel like nearly enough for me to sleep easy at night. Consequently, I’m very frugal day-to-day.
I shop at Lidl, drive a Skoda, don’t splash out excessively on clothes for myself, and make my son Byron’s school shoes last until he grows out of them, even once they’re tatty.
However, we have a hefty £227,000 mortgage on our four-bedroom semi-detached home and the childcare costs are still £8,400 a year.
But a chunk of that is covered by the tax-free income we get from our student lodger and the Government’s tax-free childcare scheme.
Friends have said that they would have to be really on their uppers to consider sharing their home with someone other than family.
But I just see that extra money from having a lodger going towards our savings pot which, one day, when the children have left home, we hope to spend on travelling.
In the meantime, it’s just a great comfort knowing that it’s there.
Monthly Joint Income: (£3,900, plus child benefit £149, and lodger £470) £4,519
Monthly outgoings: £4,519
Utility bills: £338
Insurance (excluding cars): £45
Mobile phones: £20
Car costs: £80
Children’s activities: £80
Christmas and birthdays: £65
Catherine Morgan, 36, a self-employed financial adviser, lives in Milton Keynes, Bucks, with husband Gareth, 39, a manager for a mortgage company, and sons George, seven, and Thomas, four
The financial adviser who was hopeless at saving
Catherine Morgan, 36, a self-employed financial adviser, lives in Milton Keynes, Bucks, with husband Gareth, 39, a manager for a mortgage company, and sons George, seven, and Thomas, four. They have joint annual earnings of around £100,000, with £6,500 in savings. Catherine says:
Given our healthy household income and our jobs (I work around the children’s school hours so save on childcare), people might assume that we have far more cash in the bank than the average person.
However, I’m an emotional spender, so when life is challenging — like when Thomas contracted bacterial meningitis as a newborn — my instinct is to blow money on clothes or soft furnishings.
That’s part of the reason — together with five years of crippling nursery fees, two year-long maternity leaves and the fact that our income is variable as I’m self-employed — that we are £20,000 in debt and only started saving money last October, once Thomas was in school. As a child, my father would take me to a building society where he would pay money into a savings account for me. Then one day, when I was about 11, I discovered that the £3,000 had gone as he had needed it to support himself after leaving the family home.
That seemed to trigger in me an instinct to spend money as soon as I had it — fearing that if I didn’t, someone else would. Thankfully, I have the knowledge and skills not to let the situation get out of hand, and we are repaying our debt and working towards building savings.
Our aim is to put away £90,000 over the next few years; we are considering sending our sons to private schools and need to know that at least the first three years’ fees are covered before the start.
I’m confident we’ll be able to do it on what we have coming in, despite the hefty £300,000 mortgage on our four-bedroom detached house, as we’re now taking the sage advice we’re so good at giving to others, about how to get the most out of money.
In fact, as well as my day job, I recently set up The Money Panel where I coach people, to help them get better insights into their relationship with money, often a product of our upbringing.
I believe that my own struggles with it mean I have greater insights, and can therefore be more helpful than someone who has never had money issues.
Monthly Income: £6,145
Monthly outgoings: £4,867.56
Eating out: £100
Utility bills: £411
Insurance (excluding cars): £319.95
Mobile phones: £64.61
Car costs: £619
Debt repayment: £272
Childcare holiday club: £10
Children’s activities: £130
Christmas and birthdays: £100
Gym membership: £70
Contact lenses: £30
Lynda Lim, 67, is a retired finance officer and divorcee who lives in West London, supplementing her pension with film work
Finance officer who wants to spend it all
Lynda Lim, 67, is a retired finance officer and divorcee who lives in West London, supplementing her pension with film work. She has £100,000 in savings plus a further £50,000 she took from her pension as a lump sum two years ago. Lynda says:
My family can’t believe I have £150,000 in a savings account which I never touch, and regularly tell me: ‘You can’t take it with you!’
However, I like knowing that it’s there for when I need it and, in the meantime, I live off my £1,200-a-month pension, plus the extra £600 a month I earn doing a bit of film extra work.
On occasions, that means getting up at 2am to travel to a location, but I’ve never been frightened of hard work and enjoy the excitement of it.
My salary averaged around £38,000 until I retired five years ago, by which point my mortgage was paid off.
I’ve always managed to save at least £500 a month, and still do, even now I’m retired.
I go on holidays every year, to Europe, Singapore and Australia, without having to dip into my savings.
However, day-to-day I’m pretty prudent. I think a lot about whether I need something before purchasing it, and never buy on impulse.
I paid £250 for a blue trench coat from Tommy Hilfiger seven years ago and was so scared of ruining it I only wore it once. So now most of my clothes come from Primark.
I’ve been teetotal all my life and eat a healthy, but cheap, diet of home-made food.
However, I see young people today spending a lot of money on socialising instead of saving, and worry that they’re not thinking about their futures.
Mind you, I paid £100,000 for my three-bedroom semi-detached house 30 years ago, but it would now cost £450,000. Who can afford that when wage increases haven’t been keeping pace? No wonder they just want to forget about it and have fun.
I don’t have any children to leave my money to, so I do intend to make good use of it before I die.
Hopefully that won’t be for a long time yet, though, so I won’t be frittering it away.
Monthly Income: £1,800 (including pensions)
Monthly outgoings: £1,790
Eating out: £100
Utility bills: £170
Mobile phones: £20
Travel costs: £0 (thanks to a Freedom pass)
Christmas and birthdays: £500
Delphine Nizet, 38, a product manager in the music industry, bought her £235,000 flat in South London seven years ago after living frugally to save the £46,000 deposit
Music manager who couldn’t sleep without a cosy nest egg
Delphine Nizet, 38, a product manager in the music industry, bought her £235,000 flat in South London seven years ago after living frugally to save the £46,000 deposit. A committed saver, she now has a £22,000 nest egg. She says:
I lived in shared houses in London for ten years after graduating and was so determined to get a place of my own that I put away up to half my wages every month.
That meant that while friends were splashing out on takeaway coffees and expensive gym memberships, I watched every penny.
Back then my wage was £30,000 and it’s now a little over £50,000, so I’m able to save even more — almost £1,200 a month — yet still live comfortably. I am single and have no children, so have only myself to support.
I enjoy eating out a few times a month but never throw away money on takeaways. It’s a stupid waste.
While I love clothes from Reiss and Ted Baker, I only shop there in the sales. My wardrobe mostly comes from cheaper High Street stores, such as Zara and H&M.
My plan is to buy a rental property this year and gradually build up a portfolio to create financial security for the future.
I couldn’t sleep at night if my savings ever fell below £6,000. I’ve never been in debt, so would hate having to pay interest to a bank or credit card company.
Some friends don’t really ‘get’ my attitude to money, and I do get teased. But others say they admire me for being so frugal.
Monthly Income: £2,950
Monthly outgoings: £2,950
Eating out: £150
Utility bills: £165
Mobile phones: £0 (paid for by employer)
Public transport: £85
Christmas and birthdays: £50
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