Each week we ask someone track their spending and (anonymously) share their saving habits for our personal finance series, How I Save.
Why? It’s all in an effort to tackle the secrecy and awkwardness around money.
Many of us struggle to know how to handle our finances, and feel like we’re watching, totally baffled, as our friends manage to save up enough money for a house deposit while we’re in our overdrafts.
The idea is that by opening up the conversation, we’ll encourage people to talk more honestly about their finances, and hopefully get everyone feeling more confident in how to handle their money.
This week, we’re following a week in money from Oliver*, 30, an international primary school teacher originally from London but now living and working in Hong Kong.
How Oliver saves:
I earn £73,758 a year and in my savings account right now I have £26,000, though most of that will be for the upcoming tax year.
I’ve saved this much money by having a well paid job and having a standing order each month that deposits £900 each month into my savings. At the end of each month, if I have quite a lot left over, I put that into my savings.
I’m saving for future house, rainy days, taxes and holidays.
I struggle with saving because I know I spend frivolously now and then and I would like to think about how to move into investing money rather than just saving it.
How Oliver spends:
Monthly expenses:
- £1,800 a month for rent (includes internet)
- £44 for phone
- Utilities are usually around £19-£25 a month but have been zero due to a government scheme (Covid/protest related)
- TV box: £40
- Travel to work: £10 a day, five days a week for a taxi pool
- £50 a year for Playstation online services
- £400 a month towards student loan repayments
A week of spending:
Monday: £1.20 on a chocolate, £12 on takeaway as it was easier than cooking – though I did have the time so could have cooked something myself.
Total spent on Monday: £13.20
Tuesday: £10.50 on an Uber to my girlfriend’s house.
Total spent on Tuesday: £10.50
Wednesday: £27.80 on takeaway. I spent most of the day on my feet and didn’t have the energy to cook. Plus, I hadn’t been grocery shopping.
Total spent on Wednesday: £27.80
Thursday: £70.90 on grocery shopping – meat is expensive here, especially imported, so this adds up.
Total spent on Thursday: £70.90
Friday: £30 on takeaway for me and girlfriend – we have an agreement where I pay for dinner and she pays for lunch, but I have no idea why I didn’t cook that night.
Total spent on Friday: £30
Saturday: £18.20 on a Moleskine diary for new start at school – every year I get one and eventually forget about using it by January.
£25.10 on pens, cards for parents and for some reason some ‘grow your own basil’ sets for my balcony, despite my keen ability to kill all plant life.
£60.50 on Lush shower gel – I needed more gel but was transfixed by the purple Sleepy Time shower gel, so ended up buying two bottles rather than one.
£4.40 on some cotton pads and some spot cream my girlfriend suggested for me
£47.30 treated my girlfriend out to lunch at a tapas place as last weekend of the school holidays
And £7.40 on fabric softener.
Total spent on Saturday: £162.90
Sunday: £22.40 again on lunch out with my girlfriend.
Total spent on Sunday: £22.40
Total spent this week: £337.70
How Oliver could save:
We spoke to the experts over at Plum, the smart app for managing your money, to find out how Oliver can put aside more (and what we can learn from his spending). Please note that tips from Plum do not constitute financial advice.
Here’s what they said:
Spending
Your total spend this week was £337.70, which in the UK could be considered on the higher side. However, the expat life often doesn’t come cheap, especially if you choose somewhere like Hong Kong, which is notorious for its high prices!
As you say, the high expenditure is offset well by your salary. And obviously there’s nothing wrong with spending your hard-earned cash.
If you’re living abroad, it makes a lot of sense to sample the local cuisine for example, especially when you’re living in a place where the takeout options are so varied and delicious.
What we found really interesting about your spending diary is the price of everyday items in HK. Even taking into account exchange rates and differing costs of living, some of the day-to-day products you are using that are imported from back home are a little on the pricey side. You could probably find a cheaper local option… but we can’t begrudge you your home comforts if they really mean a lot to you.
In general, getting the best value out of your spending is all about making sure your money’s going on things you really care about.
Though you’re earning a good salary and are unlikely to fall into debt, a budget is always a good way of keeping track of what you’re doing and make sure you’re spending on the things that matter most.
That way you’ll feel more in control, and worry a lot less when that pot of basil is calling your name!
Savings
Having £26,000 set aside is fantastic, although given that you say most of it will be going on taxes, it can never hurt to give your savings a bit of a boost.
You don’t say where you’re putting your spare money, but it’s good to make sure you have some of it easily available for emergencies (enough for a last-minute flight home, or to cover your rent for a few months). Then you can put the rest somewhere less accessible, such as a savings account with an interest rate that beats inflation. There aren’t so many of these on the market right now, but with a bit of research, you should be able to find one that meets your needs.
You mention that you’re saving for a number of things, including a future house, rainy days, taxes and holidays. If you use Plum, you can create different, personalized pockets for each of these goals and set yourself targets. You tell Plum exactly how you want your money split between each goal, and then our handy AI will do the rest, stashing away small amounts every few days.
*Name has been changed.
How I Save is a weekly series about how people spend and save, out every Thursday. If you’d like to anonymously share how you spend and save – and get some expert advice on how to sort out your finances – get in touch by emailing ellen.scott@metro.co.uk.
If you want more tips and tricks on saving money, as well as chat about cash and alerts on deals and discounts, join our Facebook Group, Money Pot.
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source https://metro.co.uk/2020/08/27/how-save-teacher-hong-kong-earning-73k-26k-saved-13185644/
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