CUT ABOVE
Nanny, 25, saved £14k on a £20k salary after ditching Uber, coffee and expensive hair cuts
SAVING cash if you don't earn big bucks can be difficult, but one savvy nanny has revealed how she put aside £14,000 on a £20,0000 salary in just one year.
Rachael Zoey, 25, decided to ditch Uber rides, takeaway coffee, expensive haircuts as well as booze.
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The Londoner, who works as a live-in nanny but is studying to be a nutritionist, also benefited as she doesn't pay rent nor any bills apart from her phone.
Yet she'd fallen into a common trap of spending everything she earned each month.
'I decided something had to change'
Aspiring YouTuber Rachael said: "I was spending all of my money. I had about £1,500 coming in every month as disposable income.
"But one day, I suddenly realised I’m not super young anymore and I had been on the same £20k salary for the last two years.
"I was an adult now and not everything was going to fall into my lap like I thought.
"The harsh reality hit me and I decided that something had to change."
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So in November 2018, she cut back on most of her spending.
"I stopped everything from Ubers, facials, dying my hair, unnecessary expensive food, buying alcohol to getting coffee out every day."
Rachael admitted they were hard to give up at first, but added that the security and freedom of having savings made it worth it.
'Savings challenge made me change my life'
The savvy saver was especially motivated after she stumbled across a YouTube video about a three-week "No Buy Challenge".
It challenged participants to only spend money on essentials such as bills, rent and food.
Rachael's top tips to save money
THE savvy nanny has shared her best tips to save cash.
- Use house or rent hacking methods to reduce cost of housing such as renting out spare rooms or moving to a cheaper area if you’re renting
- Find ways to reduce money spent on transportation and food as these are usually two large outgoings.
- Spend time writing a list of all the activities or hobbies you could do that are free or cheap yet you personally find fun
- Prioritise unnecessary costs. Don't do and buy everything you want but prioritise a few activities or items that have the most value to you
- Set up clear budgets for housing, utilities and contracts, food, transportation, entertainment and non-essential shopping
- Set up a standing order for your savings to go straight into an investment account (make sure you're aware of the risks beforehand)
She decided to give it a go, and after just three weeks she'd already saved almost £1,000.
Rachael said: "That pushed me to change my life."
Next up, she went through her bank statements to see exactly where her £1,500 salary was going each month.
She said: "It was all going on coffee, Ubers, clothes stores and beauty treatments.
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"I decided to stop all this spending and immediately cancelled all my unnecessary monthly direct debits such as my yoga memberships and Netflix subscriptions."
Instead, she made her own at-home facials and coffees as well as cooked at home and invited her friends for dinner.
Rachael said: "Everything I could do myself or spend some time finding a free version of, I would."
'Giving up alcohol boosted my savings'
She also gave up alcohol as it was one of the main drivers behind her spending.
She said: "I understand how hard that decision can be for most people.
"But I think everyone can agree if you’re going out spending money on drinking then you’re going to be spending money on food afterwards or Ubers back home."
It paid off because in November last year, 12 months after she started putting aside cash, she'd amassed savings of £14,000.
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She currently spends a monthly maximum of £95 for her gym, phone and tablet bills, £120 on food, £100 on public transport and £200 to spend on clothes and going out.
She invests the rest of her earnings in index and passive funds through investment management service Nutmeg.
Investing your cash can outperform the return you get from a regular savings account if it goes well.
But be aware that it doesn't come without risks, and if it goes badly, you could also lose the cash.
How much Rachael spent before she started to save
BELOW'S a breakdown of Rachael's earlier spending every six months.
- Coffee- £210
- Hair colour and cut - £180
- Uber - £360
- Facials - £960
- Face cream - £270
- Fancy food - £480
- Clothes - £700
- Meals out - £540
- Netflix - £36
- Uni lunches - £216
- Train journeys - £120
- Alcohol and nights out - £240
Total: £4,312 per six months or £8,264 per year
And although Rachael's strict budgets can be tough at times, she reckons it's worth it.
She said: "Life is so much better and rewarding now.
"I love working and I always plan to. But it’s nice to know that potentially in ten years’ time, I could be in a position where I could choose where and when I would want to work."
Struggling to save? A couple of months ago, The Sun launched the Cash Clinic series helping our readers put aside cash.
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