Your Money Non-Negotiables
Money can be a very tough nut to crack. Especially when you have important expenses every month and you want to go and enjoy yourself.
It can feel like an incredibly daunting task of having to save a percentage of your monthly income when you have so many expenses.
Today, I'm sharing how I manage to make this work for me and how you can do the same.
Let's dive in.
Step 1: What are your non-negotiables?
I have hobbies, you have hobbies.
We all have hobbies, and they can take up a little or a lot of our time and money throughout the month.
It can be so enjoyable getting into something that you really enjoy, and sometimes you may not see the consequence financially.
What is it that you enjoy so much that you simply couldn't give up?
It could be a weekly social event, your favourite sports team, going to the gym, playing chess, the Freemasons. Anything you'd consider something that you couldn't live without, is a non-negotiable.
I'm not talking about food and water, because they are the basics that we need to survive. But there are many things that you do on a monthly basis that you do for enjoyment - regardless of what it does to your bank balance.
Step 2: What can you budge on?
We've looked at the things you can't live without, now let's look at the things you can live without.
The truth is, there are things that you do on a monthly basis that, purely from a financial standpoint, you could stop doing.
This could be smoking, going to the pub or going on a shopping haul.
I'm not trying to be anti-fun, but it's worth considering sacrificing a few of these in order to build a cash pot.
Step 3: Can you get any cheaper alternatives?
Another way to potentially save yourself some money would be to look at cheaper alternatives to what you're currently doing and spending.
For example, until COVID came and shut the world down, I was obsessed with football, and in particular, my local team Hull City (I know, for my sins). I went to every game I could, visiting grounds all across the country and paying a hefty price as a result.
The club played 52 games in one season, and I attended 48 of them. The only four I missed were home games that I couldn't get off work.
In 2018, I moved away from Hull to the other side of the pennines to Lancashire, so paying for travel to and from Hull wasn't the easiest thing to do.
I visited 50 of the 92 football league grounds across the country, attending over 100 away games and well over 300 home games.
I was so passionate about my local football club and everything that came with it, to the camaraderie, to the friends I made, I adored it.
But it really took it's toll on me, physically, mentally and financially.
I ended up spending over £10,000 in just two years, on match tickets, food, train tickets, coach tickets and just about everything in between.
I had some great days with my mates, but I paid for it heavily.
I began feeling very unwell every time I went to football, feeling constantly sick. I only felt that way when I was there, and as soon as I got home I was fine again. I'm sure it was anxiety - but after going to football for so long I'm not sure what I was anxious about.
COVID halted the world, which meant football too. It allowed my body and my bank to have a break. From March 2020 to October 2020, I managed to save well over £9,000.
I haven't been back to a football match since.
The reason for that is because I understand the ridiculous nature of the prices.
I decided to completely cut that out of my life, and watch my beloved MotoGP instead.
I go to Silverstone every year to watch the race weekend, which costs me less than £1,000 (including travel, tickets, parking and accommodation). It's not exactly cheap but it's a hell of a lot better than what I was paying at football.
And to tell the truth, I enjoy it more.
I've given myself the ability to save more whilst also really enjoying myself.
I found a cheaper alternative with MotoGP rather than going to football every week, and I'm saving the difference every month.
Try to find ways in which you can cut expenses but still have just as much enjoyment.
Step 4: Don't go overboard
The thing is, it's really easy to go one way or another with this.
You can quite easily cut all expenses, stop having any hobbies and quit social time.
When COVID came, I stopped going to the pub, football and going out with friends, and it allowed me to save a good sum of cash.
It's really impressive, but it's not sustainable.
Because you get to the stage where you are losing friends, becoming bored easily and simply not enjoying yourself.
The same can be said for spending too much. If you spend more than you earn month on month on liabilities such as clothes and other hobbies, you're going to put yourself in a debt trap really quickly.
Obviously, this isn't sustainable either.
Finding a happy medium will really help you as you'll be able to enjoy yourself, be able to cut back, build a savings pot and still pursue your passions.
So how can you reduce your expenses whilst still enjoying what you do?
It can be a very tough nut to crack, but once you do you'll be set up financially.
You'll be able to save that extra every month for your new house, your new car, your next property investment.
This will push your progress to financial freedom quicker.
Remember: you're already doing so well with your finances - why not take them to the next level?
This Week's Action Step
If you don't have one, create a budget of all of your expenses, and categorise your non-negotiables and the expenses that you could budge on.
This will really help you understand where your money is going and how you can work more smart with it.
Then once you've done that, go ahead and start streamlining your expenses.
That's all for today.
See you next week.
P.S. Is there a topic you're itching to learn about? Send me your ideas and I'll add it to my upcoming newsletter ideas. Thanks!