Welcome to How I Made It Work — Bustle UK's financial series which aims to demystify money and the process of achieving financial stability. This time, HIMIW hears from a 30-year-old disability and chronic illness advocate who describes herself as a "penny-pincher" and believes everyone needs to do a money makeover every year.
Age: Dirty 30 or more like extremely-tame-because-I am-old-now 30.
Occupation: Disability and chronic illness advocate.
What is your current salary? Some paid writing and freelance gigs but generally not a lot while I set up my business.
How long have you been earning this amount? I gave up working in TV over a year ago. My partner and I went from having a decent amount of money to a third of our income as I had to give up work due to my chronic illness.
Do you receive regular financial help from friends, family, or a partner? How do you think this has impacted your relationship with money?
My partner and I have always shared finances since we bought our first home together. We found that this meant that we could combine our money and make it work for us. We paid off a reasonable amount of debt just before buying our house and still saved enough to pay for all the building work.
How would you describe your relationship to money?
I’m a penny pincher. My previous job meant I was in charge of substantial budgets and it was on me to account for every penny. This has carried over into my personal life. I keep spreadsheets that detail birthdays, car insurance, household bills, basically anything that always comes up every year. I then pay a monthly sum to cover all these through out the year.
Do you believe you feel you are currently in a stable position financially?
With taking down our income by a third we are not as stable as we once were but we have a decent amount of savings and make sure we live within our means. If the boiler breaks tomorrow *touch wood* we would be able to cover it.
How did you achieve stability?
By ferociously paying off debt and not having an overdraft. We went without a lot of things for a number of years to be able to get to a point where me giving up work wasn’t the biggest issue. We always worked as if only one of us was making money so anything the other person brought home was a bonus and mostly went to debt payment or savings.
It meant buying a smaller home that was further out of the city (but we’ve paid off far more of our mortgage than our friends and it’s a third of the price plus we get better mortgage deals). It also meant doing things differently like challenging ourselves to only spend £50 on each of our birthdays but using coupons and deals to get a meal, fun activity and present. We always use cash-back sites and wait for sales for items we really want. A lot of it is asking yourself if you really need that thing or is being debt free more important. Not having to worry about how much the gas bill is this month is so much easier than having that new dress that will get shoved to the back of your wardrobe after a few wears.
If you feel financially stable, has this been the case for most of your life, a few years, or is it a very recent thing?
This has definitely not been my experience for long. When I first left uni I really struggled to make ends meet. One year I earned so little from my two jobs that I didn’t have to pay any tax. Yet I still managed to save money that year. I used to shop in charity shops before it was fashionable. I always bought my fruit and veg from market (and still do) most cities have a fruit and veg market (often on a Sunday). You can get things like trays of strawberries for £1. I’ve even had a tray of mangos for £1. Then I fill my pantry with cheap things like oats, pasta and rice. You can eat really well on very little if you just shop slightly differently. Grains and pulses can fill out any meal and are far cheaper than meat which is a win win because less meat helps the environment too!
Do you own any properties (and how many)?
One with my partner.
Did you have any help from partners or family members to put down a deposit or pay the mortgage?
I was very lucky as my partner had a good lump sum he had saved while he lived with his parents. They had a deal that he didn’t pay rent but that money had to go into a savings account for a house deposit.
What does financial stability look like to you?
Not worrying about the bills going out and hoping they aren’t bigger than you expect. It’s also having a little something left at the end of the month and being able to treat yourself to nice things every now and then. I’ve ranged from having enough money to think that £100 wasn’t all that much to spend to having to count every penny that year I didn’t get taxed. The thing I found was I was far happier when I had no money but could still afford to go out with friends than when I had more money than I knew what to do with. I think stability is really just knowing you have a roof over your head and where your next meal is coming from. It’s being able to look after the ones you love.
What advice would you give to young women who are worried about achieving financial stability?
Get nerdy. Seriously. Yes it’s lame, yes it’s incredibly boring but no one else is going to get to grips with your finances for you. Get a spreadsheet, know when all your bills are due, set reminders if you can’t automate them. Get to know your credit score. And my biggest: do a money makeover. Money Saving Expert have a step-by-step guide and, as horrible as it is, it really is the best paid day you will ever have. It takes you through all your household bills, your phone bill, basically anything you can save money on and tells you how to get the best deal. It will take the whole day and you will need to down a bottle of wine after but it’s the thing I religiously do every year. If you do nothing else, do that.
What one piece of advice would you give to young women who want to improve their relationship to money?
Care about it. It’s not just boring bills or numbers. It’s freedom, it’s not having to worry. It’s your future. Find a way of looking at it that isn’t just numbers, it needs to mean something to you. That might be paying off a debt or saving a deposit for your first house. Make it something you really want and then set a goal and stick to it.