Following on from The Single Tax
Saving whilst single is not for the faint hearted and is not a response to Covid-19. We all appreciate that circumstances are not normal. At a time of crisis your options are limited. The idea is that you would have savings to lean on. But the reality is that most of our gave up on ISAs and saving plans during the 2008 market crash.
Is this something we need for a future Pandemic day? I’d hate to see people stuck in bad relationships because they can’t get out financially. Full disclaimer: I currently have 48 pence in my savings account but that’s because I took all of my savings out and paid off my credit cards instead. Those interest rates were killing me
So ever since the piggy bank days I’ve always been a bit of a saver. Never as much as I should but, when I was married I started a Sunny Futures account for my yet to be conceived Future Children. Blown that fund on gigs and hotels of course but, it’s the concept that saving doesn’t have to be something you do out of fear. It can be something fun too. Just have a back up plan. I get it from my mother who is a squirrel. That’s what growing up in Apartheid south Africa teaches you so I’ve always done a little saving. Part of the fees for purchasing our first house came from my £2 coin collection. When £5 notes came out I saved those too. It’s better than stamps and healthier than my old champagne collection.
There are more qualified money experts out there but I’m going to talk through a few options for the Single Diva because the one thing I know is that if saving feels like a sacrifice I’m not going to do it.
How to save
I really can’t stand those suggestions of giving up your coffee everyday or cigarettes (give them up because they’re disgusting too) or expensive holidays (I deserve to treat myself 3 times a year!). Daily saving is sustainable. Another popular one is the putting money in a jar but you only save about thousand a year that way and if we’re honest nobody is using cash anymore? Just not going to work for me either. Budgeting is also a no go for this diva.
The best way to save is to not even notice it leaving your account. Standing order it into your savings account. It needs to be accessible quickly so don’t worry too much about interest rates as they’re shit for savings anyway. Just put your money away for a rainy day.
I calculated it as the amount it costs to look after my body (e.g.. get my hair done) + a weekly solo date + what I was paying in interest on credit cards + what was in my purse at the time and came up with about £500. I tried it for a year and was constantly going into my overdraft because apparently that wasn’t realistic. It only ever lasted a few weeks and I was constantly taking it out to pay bills so settled on £250. Not everything works.
This is something I’ve tried to start a few times but failed but mainly I thin because I don’t have a collective group from school or a sports club that I see regularly enough to maintain. The stokvel as it’s known in South Africa is where each month everyone puts in money and gives to one person. The recipient hosts and collects their pot. This way you’re saving through giving and depending on the number of people in your group get a regular lump sum. Of course you don’t have to take the money out but for some the draw is the togetherness and celebration each month. I know of a group of Nigerians men who played football together on the weekend and saved enough to purchase a flat together. It can work.
The Second Income
The portfolio way of working is increasing and those with 2 or 3 jobs are finding that they may have more resilience during Covid-19. Some do this through having a permanent, stable role and then a second one which is the same but on a free lance basis. Others are finding that they are losing all 3 incomes and have a lot of working capital they can’t recoup. I’m not sure that it’s a case of having a second income as much as it is about having a resilient income. Something that doesn’t involve spaces, travel etc are probably best. This isn’t a quick solution to cash flow issues either so take time in coming up with something that works for you.