I grew up surrounded by a strange attitude to money. My parents ran their own business, which, like many small businesses during the 80s and 90s, seemed to be stuck on a rollercoaster barely clinging to the tracks. Some years were a success and there were holidays and gifts and plans for the future; more often there was stress and fear and scraping together. The attitude was that when the money was there, you should spend it, because who knew when we’d have it again?
You might have hoped that witnessing the stress this caused would have taught me a strong lesson about financial responsibility. Sadly, you would be wrong. I racked up credit-card debts, would spend my salary on the first weekend of the month and limped through to payday for the rest of it. I bought tampons on my Boots points card. As I got older, friends acquired savings and holidays and cars and mortgages, but I never had the money. I simply couldn’t understand how they made it work when I couldn’t.
But, last year, things changed. I found the most affordable first-time-buyer scheme in London, put my name on the list and waited. Eventually, a mortgage broker called me with good and bad news. The good news: I was eligible for the scheme. The bad news: as someone who was now self-employed, I would need to have double the usual deposit and my bank statements would be analysed with laser precision for any signs of irresponsible spending. If I wanted the mortgage, I was going to have to learn how to budget and save.
Luckily, I saw a friend’s Facebook post promoting something called Monzo. A pre-paid credit card, Monzo also came with an app that would let you allocate funds at the beginning of the month to certain categories. Each time you paid for something, Monzo would note it against the relevant category and send you a text letting you know how much was now left in that area. It was life-changing. Suddenly, I had my very own financial Jiminy Cricket in my pocket, popping up to remind me that I didn’t really need that extra coffee and I could buy that coat if I wanted, but that would be it for my clothing allowance. And as I saw my savings account begin to build, so I became tighter and tighter.
As women, we’re constantly subjected to advertising telling us that our lives would be infinitely improved if only we bought this bag, this dress, this make-up, this overpriced razor
As women, we’re constantly subjected to advertising telling us that our lives would be infinitely improved if only we bought this bag, this dress, this make-up, this overpriced razor. We’re hounded by the belief that our lives are better when we spend more money. I believe this is compounded by the fact that women have really only been able to control their own finances for the last 50 years – it’s still a new freedom. Is it that surprising then that, for some of us, a little spending is still the biggest rush?
If, like me, your natural inclination leans towards “buy, buy, buy”, there are some amazing books and apps out there that could make 2018 the year of “save, save, save”. I signed up for a Monzo card and love it, but the brilliant You Need A Budget app does pretty much the same thing with your current account, thereby saving you the trouble of having to learn a new pin number. It’s not free, but the app claims you’ll have saved as much as it costs in the first month, so it’s a good investment.
Wally can link together all your banking products, so that you can see how much you’re spending and how much you’re saving, all in one app. It will also send you notifications when you spend too much and congratulations messages when you hit a savings goal.
If you’re looking for apps that are even smarter than you are, then Squirrel is a cross between money-saving nirvana and living back with your parents. It basically holds your salary and pays it out to you bit by bit over the course of the month, neatly protecting you from those payday splurges. For anyone who wants their 2018 to be a bit more Wolf Of Wall Street, then try downloading Moneybox, which invests your spare change on the stock market – you can start from as little as £1 – or, if you’ve got a little more to play with, Moola helps those starting off at the bottom of the investment ladder understand what they’re doing.
Pretty much all of these apps employ the principle that says if you can see what your money is doing, you’re less likely to fritter it away. A year of tracking my spending didn’t just help me buy a house, it also helped me understand why I spent – the surge in Pret coffees on a Friday when I was tired or my Amazon addiction that peaked when I was procrastinating over a piece of work. It also allowed me to find places where I could easily save – rather than just paying my phone bill each month, I became obsessed with finding the best deal. I started picking the cheaper options on the menu when I went out for dinner. None of these were big changes, but they added up – and, reader, I bought that house.
This is part of our special new-year series called Small Change, Big Difference – small things you can do in 2018 (and not big unrealistic resolutions you can't keep). To read more in the series, click here