Tag Archives: savings

How much are you willing to sacrifice?

Sitting here with the light off to save electricity costs,  I’ve been thinking:

How much are we willing to sacrifice to own a house?

I think I am fairly lean in terms of sacrifice, I live my life fairly close to most people. I would say the only difference being is I try to keep electricity cost down and I don’t buy goods that I can live without.

But alot of people can go more extreme, selling their car in the pursuit of saving £1000 per year as I highlighted in this post HERE.

I read just now about a guy who lives in his van. And I dont think it would be too difficult.

  • Showers could be done at the gym (something I do anyway)
  • You can cook using a camping stove
  • If you park it near to work / gym / supermarket you will have a toilet close by

Sure, I wouldn’t tell anyone that I live in a van to save face, but it just goes to show that humans can easily adapt to new surroundings easily.

Like I said earlier, I haven’t sacrificed much but I have adapted to a cheaper lifestyle.

  • I drink Aldi branded coffee, some people has scoffed at the thought of drinking this coffee, but I learned to love it and it wasn’t difficult.
  • I sold my old convertible and bought a more efficient car
  • I often cycle to work (I start at 6:00AM so this isn’t practical during the winter
  • I get triggered when lights are left on, this has become a personal hatred of mine

In all, my friends don’t see me as a scrooge because I haven’t changed the way I interact with them. I just make several small adjustments to my lifestyle to save a lot more money

3 types of home deposit savers

In my view, there are 3 main types of deposit savers, each with their own benefits and flaws. It is easy (sometimes) to move between each type, I have for instance, been all 3 types at one stage or another.

Type 1: Living with Parents

Benefits:

  • Cheap (sometimes zero cost)
  • Reduced food cost
  • Rent (if any) usually includes bills such as electricity, gas and internet
  • Easy to rely on parents for meals and other things

Negatives:

  • Conflicts can happen (nearly every family argues at one stage or another)
  • Lack of independence and privacy – no one wants to bring a partner back to their parents 😉
  • Dont learn how to rely on yourself – life experience

I haven’t lived with my parents for about 6 years now, I don’t think I really appreciated it when I did and I wish I could work closer to home  so that I could temporarily stay with them.

Type 2: Living in a shared Flat / House

Benefits:

  • Cheaper than renting an entire flat
  • Can share with friends for an awesome time
  • Meet new like minded people
  • Easy to car share to shops etc

Negatives:

  • Personality conflicts
  • Lack of privacy again
  • Can break apart friendships

Throughout university I lived with 4 different groups of people, some I got on really well with and they became buddies, others I dreaded seeing and would go out of my way to avoid (I’m sure they did as well). Also, washing up dishes is ALWAYS an issue.

Type 3: Living alone (or with Partner)

Benefits:

  • You can keep the place as clean / dirty as you want
  • Privacy
  • No personality clash issues

Negatives:

  • Cost of full rent
  • Cost of Utilities
  • Can be lonely (if by yourself)

This is my current situation, me and my girlfriend rent a flat together. Although it costs more to rent the flat outright, we value our privacy and so are willing to pay the extra.

Conclusion:

You will know yourself what situation you’re willing to live in order to save up for a deposit as quickly as possible. There are people who cannot stand living with their parents and so are willing to pay the extra just to have more ‘freedom’

For myself, I don’t mind where I would live. There are benefits to all scenarios and also drawbacks, but if you are looking to save for a deposit as soon as possible, I have ranked the locations in order of cost:

  1. Living with parents
  2. Renting a property with others
  3. Renting alone

 

 

Novemeber 2015 – Savings and Income

From this month on, I’m going to provide monthly updates to my savings. This will show the (hopefully) monthly increase in savings to reach a goal of a house deposit.

I will try and complete each post by the 1st of each month, so this month is a little late…oops!

Account Name Account type Amount
TSB 1 Current £   2,000.00
TSB 2 Current £   1,370.59
TSB 3 Current £                 –
TSB 4 Current £   1,226.85
Halifax Current £       794.10
Halifax Credit -£   2,959.47
Virgin Credit -£   2,724.24
Halifax H2B ISA £   1,200.00
Ratesetter P2P £       220.00
Fidelity Stock & Shares ISA £   2,471.39
Total in credit £   9,282.93
Total debts £   5,683.71
Total Net worth £   3,599.22

As you can probably see I have my money spread out quite a lot, this is for a number of reasons but each account has its benefits.

TSB Current Accounts:

The TSB current accoutns each provide 5% interest upto a maximum of £2000. So if I was able to (hopefully soon) max out these accounts then I could earn £400 interest (minus tax).

Halifax Current Account:

If this Current Account is in credit and has at least £750 paid in every month then it will pay out £5 per month.

Halifax Credit card:

This credit card is used for “Stoozing”. The long 0% interest on purchases that the card offers means that I can spend on the credit card and still gain interest from the money in the TSB accounts

Virgin Credit card:

This is another type of “Stoozing” card, the card provides 0% interest on money transfers (there is a 1.89% fee). I transferred this balance to the TSB accounts to gain interest

Halifax Help to Buy ISA:

The help to buy ISA is a great way of saving for a house deposit, I ran into more details about the benefits HERE.

Ratesetter:

Ratesetter is a provider of peer 2 peer lending, the website provides people loans funded by other people. The benefit is two-fold, firstly the lender (you & me) gets a great interest rate on our capital. Secondly, the borrower can get a low interest loan. If you are interested, please click HERE (Referral link)

Fidelity S&S ISA:

I opened up the S&S ISA last year and pump £200 per month into it, the past year hasn’t been great for my index fund (Vanguard Lifestrategy 100%) but I’m hoping it will pick up over next year, just in time to buy a house. I will go into more details regarding Index Funds in a later post

Income VS Expeditures

Nov 15 income

Income at the moment is fairly consistent, the “property” portion is rent contribution from my girlfriend

Main Salary £             1,875.65
Interest £                   9.39
Property £               300.00

Nov 15 Expenditures

Ill be honest, November was a BAD month.

Household: includes rent, food and bills, I pay bills on a quarterly basis and they both come out during one month. I will change this to a monthly to make comparisons easier.

Insurance: Being a 24 year old male, insurance is still sky high for me even though I have a boring car. At least its only a yearly expense

Gifts: I bought one significant gift this month, very costly and out of character for me. But she deserves it 🙂

Other: This consists on mainly Fuel and cash, I can only think the cash withdrawals are from nights out… its bad I cant remember ha

Going Out: We went for a long weekend in Rome on the cheap, this expense is usually a lot cheaper

Household £1,249
Insurance £513.73
Gifts £299
Other 173.08
Going out 141.71

Total savings for November: -£192

BAD MONTH