Category: budgeting

How to Manage Your Money (Lessons I Learned from my 1st Job)

money management for beginners

As a 16 year old schoolgirl, I decided that £1.50 per week pocket money from my parents just wasn’t going to cut it.

So, I headed to the local ice cream shop, armed with nothing but the confidence of youth – plus some inside information that the owner paid a better hourly rate than the local supermarket.

After a brief chat with the owner, I was taken on for a trial.

I passed with flying colours. To be fair, it wasn’t too taxing.

And that was that. I was the new Saturday girl. (Technically, I was the Friday night/all day Saturday girl, but that’s not as catchy).

Over the next 3 years, I perfected gift wrapping, complete with bow ties and curled ribbons.

I flirted with the boys in the factory (hey, I was a teenager – don’t judge me!).

And I probably ate more ice cream than is deemed healthy in a balanced diet.

While my little ice cream job was a way for me to earn a bit more cash than my measly pocket money allowance had given me, looking back on it, I did learn a few financial lessons along the way that I still use today.


Pay Yourself First

My entire motivation for getting a job in the first place was money.

I didn’t have a deep desire to gain ‘work experience’ for my CV.

Come on. I was 16. I barely thought beyond the end of the week, never mind ‘what I was going to DO with my life’. (This may explain a great deal about my career path).


I didn’t have an overwhelming love of ice cream. Perhaps a slight crush but not a full blown passion (honest).

All I wanted to do was earn some cash.

When I started, I was earning the princely sum of £12.50 a week. Not much but, with no dependents or bills to pay, I managed to put £8 in savings and the rest was mine to spend.

Now, £4.50 might not be all that much, but if you remember, it was three times the amount I’d been getting in pocket money.

It was also the late ’80s, and bought a surprising amount of ear-rings, Depeche Mode CDs, clothes from Top Shop and, in the later years of my wee job, rounds of drinks in the pub.

I was rich.

Not only that, but I managed to save up enough to pay for a full set of driving lessons by the time I was 17 (and I passed first time. Woo hoo!)

I also saved up and paid for my first holiday abroad (sans parentals) when I was 18. I went with a friend, her boyfriend and my first serious boyfriend – who just happened to be one of the boys from the ice cream factory 😉

I would have had zero chance of doing either of these things without having saved up for them myself.

My folks had made it perfectly clear that they weren’t going to pay for me to learn to drive (which is fair enough) – or to go on trips to Europe with a young man. My Dad was particularly clear on the latter I seem to remember!

But it was the first time in my life that I actually felt independent and had some control over my life thanks to my own efforts.

And there’s nothing quite as liberating as knowing you’ve done it yourself.

I think the girl who is able to earn her own living and pay her own way should be as happy as anybody on earth. The sense of independence and security is very sweet.

Susan B. Anthony


Profit Margins are King

Working in an ice cream shop, I discovered that there’s a 200% markup on the ice cream itself (yes, really, 200%).

I also learned that there’s very little profit in tobacco sales.

Because of this, I couldn’t understand why we bothered with cigarettes until the boss pointed out that some people only come in to the shop to buy them.

And of course, not only were the ice cream (200% mark up remember) and the chocolate counters directly in front of the tobacco shelves, but we also made them both look SO enticing that the customers just couldn’t resist something sweet to take with them.

(And quite possibly to stop their breath smelling quite so bad).


Despite What They Say in the Ad, Tax is Actually Quite Taxing

A Saturday job is unlikely to see you bringing home big bucks.

However, during one of the summers – possibly the one between school and university, I managed to work pretty much full time between the ice cream shop plus some additional bar work that I’d landed.

And that’s when I somehow pushed myself over the minimum tax threshold.

I went from pocketing everything I earned up to having to hand the tax man 25% of my earnings from all of the extra work that I’d taken on.

And worse, I then had to keep paying him for the rest of the year!

I’d never had to pay tax before. It wasn’t a happy moment.


Mental Maths

You’re probably thinking that most ice cream shop customers are kids, but you’d be wrong.

They are pensioners.

Lots of grandparents treating their grandchildren or older people just treating themselves (and why not).

This fact led me to discover 2 facts about old people.

1. They appear to have more of a craving for sweet things than the rest of the population (apart from my husband).

2. They have a skill at doing mental maths – a fact of which they are inordinately proud (and, frankly, a little bit show offy about).

On Friday evenings during the break at the neighbouring bingo hall, old men and women would square up to me across the counter,

‘So how much do you reckon 2 cones, a 99 tub, 10 B&H and a packet of bon bons cost then, love?’ they’d ask menacingly.

(Actually, it wasn’t remotely menacing, I just said that for dramatic effect. They were really quite friendly. By which I mean, they were laughing at me because they knew I needed 5 minutes and a calculator. While I’m ‘fessing up, they also said ‘hen’ instead of ‘love’ because that’s what they say in the part of Scotland that I live in, but I’m writing for an international audience here so…)

Like lightning, they’d have calculated the answer in their heads before I’d even added the first two.

I quickly learned that I’d need to be as quick off the draw as my elderly customers.

3 years and lots of practice later, I reckon I won as many of these challenges as I lost. An improvement on the total wipeout of my early days.

Despite scoffing at the lack of need for mental arithmetic when I was a teenager, it comes in very handy these days when quickly figuring out requests by the kids for treats or calculating the tip on a café bill.

And all of these financial lessons have stood me in good stead over the rest of my life.


I always pay myself first, and have managed to build up a nice little savings buffer with enough cash for emergencies and retirement. I’ve pretty much avoided debt too, and paid off my student loan in less than 4 years.

I always calculate my tax return MONTHS before it’s due so I know exactly how much money I can spend or save without eating into the tax man’s money.

I have short and long term savings goals for treats like holidays, and essentials like my pension.

I can quickly and confidently negotiate rates with clients, working out whether the extra hours or the discount they’ve asked for is worth me doing the job without having to resort to a calculator or putting them on hold while I figure it out.


Perhaps most importantly though, I learned that ice cream is not a food group. Even if you really want it to be.

The raisins in rum & raisin ice cream do NOT count as one of your five a day.

And sorbet, while extremely low fat, is in fact, full of sugar.


What did your first job teach you about money management that has stuck with you since then?


Book Review Tuesday: The Wealth Chef

book review tuesday


It’s the first Tuesday of July so it must be…

Book Review Tuesday!

OK, I know this is only the second of these posts, but my aim is to feature my top recommended books each month that will help your freelance life run a bit more easily.

Last month I featured the fabulous Marianne Cantwell’s Be A Free Range Human, all about finding the life and work that you love – and that you were born to do.

This month, I’m focusing on money.

the wealth chef book reviewI’ve written in the past about how to save enough to quit your job and how to cut your costs when going freelance, and I have to say a huge amount of credit for all of this has to go to Ann Wilson, author of The Wealth Chef.

I first came across Ann via another website about 6 months ago. I started off by reading a free chapter of her (then online only) publication, The Wealth Chef, and from there on in, I was hooked. I’ve since subscribed to her emails and regularly read her blog. In fact, she featured in my recent Top 10 Recommended Small Business Blogs.

I now have the recently published print copy of the book and, it’s fair to say that I live my financial life according to Ann’s wealth recipes.


The Wealth Chef focuses on changing your attitude towards money by flipping the common perception that we work for money into money should work for us.

What I particularly like (and this probably says more about me than anything else!) is that, while Ann encourages you to cancel your debt, build your ‘wealth pots’ and create an income to give you the life that you want, she doesn’t say you have to deny yourself entirely of any pleasures.

In fact, she talks in the book about how being too frugal can sometimes backfire and result in a money ‘binge’ – or, worse still, not having your money work for you in the way that it really can.


Ann shows you – through her down to earth writing style – how to set financial goals, how to pay off debt (with handy tools to fix your financial goals each month, quarter and year), how to set up investments and how to earn passive income.

She also turns some common perceptions on their head.

I have ALWAYS thought of my house as one of our assets. Ann shows just why that isn’t the case, particularly if it’s mortgaged.

As the title suggests, kitchen terms are used to refer to different ways of saving, spending, investing and blitzing debt. Ann talks of creating recipes for wealth and growing wealth pots and this approach really helps you to start to see how your money will work for – and against – you. In fact, I found the whole book really visual and appreciated the easy to follow guidance.

I’ve got a degree in Economics so I do understand a bit about the stock market – but you certainly don’t need a business degree to get the most out of this book. It’s easy to follow, and is completely jargon free.


Like Marianne Cantwell in my last review, Ann Wilson has also walked the talk. She’s come from a background where she earned a good salary, before she came rocketing down to reality when her lifestyle came crashing around her ears.

Through trial and error, Ann has taught herself how to view money differently in order to create financial success, as well as teaching herself practical lessons in investing in the stock market and creating passive income streams.

The fundamentals of wealth cooking are introduced – assets, liabilities, income and expenses – in a way that is SO easy to understand, I wish my high school teachers had read this before coming to my class! You can see how and why money might not be working as successfully as you would like.

Ann also gets you to think big, to dream of a life that you want and create tangible goals for your wealth – so that you’re not just aiming to ‘be rich’ but instead have specific goals in mind when you start out on your journey.

And of course, the beauty of it is that your goals can be as different and as large or small compared to the next person, as you want them to be.


Aside from the practical, easy to follow advice, as someone who loves to plan and to see goals written down, I particularly like the downloads that you can access after reading the book.

Putting in to practice the lessons that you’ve just learned, and using your own financial situation, you can create monthly budgets, a balance sheet, and long term investment goals.

There is nothing more powerful than seeing your debt destroyed.

We didn’t have a huge amount of debt – but by determining which debt we wanted to blitz first, and assigning a monthly payment target, we were able to completely pay off our 2 main consumer debts within 4 months.

We still have our mortgage but it is diminishing through the overpayments we’ve managed to set up by following Ann’s advice and blitzing the other debts we had.


Anyone can invest and take advantage of the real gains that are available in stocks and shares and the property market. Savings interest rates are so low at the moment, they are hardly worth bothering with and the only way to really make money is through longer term investment.

Once only available to the very wealthy or the very knowledgeable, investing in the stock market – and using investments to grow your wealth – is attainable for many of us.


Unless you are so rich that you already have an investment portfolio that is providing you with all of the wealth that you need, this book is a good read for anyone with a passing interest in improving their financial situation.

Even if you’re not interested in creating a stock market portfolio, there are lessons in everything from blitzing your debt, to paying off your mortgage early, and from reducing your monthly outgoings to creating passive income streams. Even if you only wanted to find out about one of those aspects, this book would be worth reading.

Ann gives you the whole picture about creating a secure financial future and – combined with the practical worksheets for you to plug your own figures into – I personally, found this book to be the one that I go back to again and again – to remind myself of key lessons or just get back on track with my overall financial goals.

This is a book written for anyone who wants to make money work FOR them, to create a lifestyle that they love, by harnessing the power of money to their own ends – rather than constantly chasing it.

You can get The Wealth Chef here.

Have you read it? Or do you have any other book recommendations for us – let me know in the comments below.




How to save enough money to quit your job

how to save enough money to quit your job


So far in the 15 Days to Running a Successful Freelance Business series, I’ve talked about the mechanics of setting up and running your business, but in Part 5, it’s time to take a step back. I know you are reading this thinking ‘I can’t wait to get started’. You may spend most of your time at work dreaming about it, but there is usually one question that is holding you back.

“How do I save enough money to quit my job?”

I’ve written about this before, which you can find here, but today I want to go into more detail.


Create a budget

Go through your last 3 months worth of bank statements and look at what you have been spending your hard earned money on.

If you only bank online, you should print each month’s statement off. Otherwise, grab your paper statements, a cup of coffee (in fact, let’s be honest here, just put a pot on the stove for this) and go through every last item in your statements.

Once you have them in front of you, organize them under the following headings:

Fixed Costs – which will be all your utility bills, rental/mortgage costs, insurances, and any fixed consumer debt costs, like car repayments or credit card minimum payments.

Variable Costs – all of your groceries, fuel, clothes/haircuts/entertainment/eating out – basically all of your bills that change each month depending on what you have on or how you’ve been living.

Savings – everything that you are currently putting towards long term savings – so this might be a Christmas savings account, your pension (if it doesn’t come direct off your salary), any investments that you make – no matter how small.

Income – your salary, any interest payments you’re making, any benefits that you earn or income from investments such as stocks or property.

So now you know exactly how much is coming in versus how much is going out. You might even have a cute spreadsheet that looks like this:

Screen Shot 2015-06-01 at 15.13.58

And if you’d like a cute spreadsheet that looks like this, just click here to download the template.

Now comes the fun part.

Go through every single expenditure item and ask yourself – can I cut this item completely or pay less for it?

Be ruthless – preferably without making your life totally miserable – and always keep your end goal in mind. You are doing this for a freelance life remember.

If you haven’t shopped around for utilities for a while, you might be surprised at how much you can save just by making a few calls.

Can you cook more at home and eat out less?

Can you change your shopping habits? Maybe shop at a lower cost store (we swapped Tesco for Aldi) or, if that’s not practical where you live, can you downgrade your brands? If you really don’t want to switch from premium to cheapest, just making the move from premium to the next priced brand will make a difference.

Save on fuel by figuring out which garage near you or on your route to work is cheapest. If they’re a 20 mile round trip in the opposite direction though, it might not be worth the saving unless it is much cheaper than anyone else. Drive at 60 – 65 miles per hour max, don’t use the car for short trips and take the bus where you can.

Do you really need someone to clean your windows once a month or could you do it yourself?

I always thought that I was pretty good with our finances, but after going through our monthly statements, switching a few suppliers and changing our shopping habits, I managed to save us around $270 per month from our bills just by tightening up on our outgoings. That’s over $3,000 per year.


Create a Savings Habit

Cutting costs is one part of the equation. You will also need to either start or boost your savings.

If you’re saving to quit your job, ideally, you should aim for having a minimum of 6 months expenses put aside before you hand in that resignation letter. That is, 6 times the amount that you have just identified as your essential costs when you went through the above exercise.

The idea is not to have 6 months of your current salary put aside, but to have enough money to cover your essential bills for the first 6 months of your freelance business life.

Why 6 months?

Well, you can save more if you’d prefer, but as a bare minimum, you are likely to spend more of your first 6 months in business trying to drum up clients and market yourself than earning money. You might, of course, be lucky and have clients lining up from day one, but it’s easier to save yourself a whole lot of stress and have that money in the bank from the start.

If you struggle to find any money to put into savings, the simple trick that you’ve no doubt heard is to pay yourself first. Make sure that you set up a direct debit from your current account straight into your savings account on the day that you get paid – or as close to it as possible – each month. Then, that money is gone and you won’t have a chance to fritter it away on Starbucks.

How much should I save?

Well, you will have an idea of how much 6 months expenses is, and you should have a clear idea of how much you can afford to put aside each month. In an ideal world, you should aim to save 10% of your salary each month, but if that’s not going to be possible, try to save as much as you can afford after making sure the essentials are covered.

Of course, you might decide that you want to have left your job by a certain time – maybe 9 months from now. If that’s the case, figure out how much money you need to save each month for the next 9 months that will give you enough living expenses to see you through your first 6 months of self-employment.


Pay off your debt

I deliberately left this after starting a savings habit, because personally, I find it easier to get motivated to pay off debt if I’m also saving at the same time. This is is entirely up to you though.

If you can afford to save 10% of your salary each month, and have debt too, it might be better to pay 5% towards your debt and 5% towards your nest egg. It really depends on the numbers you’re facing.

If you have credit cards on high interest rates, shop around to try to find a 0% card if possible. That means your payments will be paying off as much of your debt as possible rather than just clearing off the interest each month.

Put your debt in order of priority – if you have a credit card, a store card and car repayments, for example, figure out which is costing you the most. Concentrate on paying that off first, while making the minimum repayments on the others. Then once that’s clear, shift to the next most expensive debt and so on…

I haven’t included your mortgage here but of course, if you decide that you want to pay it off before going freelance, you could add this into your debt priority payments. Even if you can’t clear the balance completely, it might be worth making overpayments (if your bank allows it) to reduce the amount you owe the bank before you quit your job.


Diversify your income

Is it possible to start your side hustle while you’re still working? Can you start to offer your freelance services part-time? This has the duel benefit of giving you small amounts of earnings, while at the same time helping you to build a client base. As you’re already earning your salary, you can use any money earned from your side hustle to pay off more of your debt or to boost your savings.


Get some cheerleaders

Try to surround yourself with people who are supportive of what you are aiming to do. We all have friends who like us to go out and celebrate with them all the time – and of course, I’m not suggesting that you become a hermit – but those friends who are constantly planning expensive nights out and making you feel bad about not joining them, perhaps don’t have your best interests at heart. After all, if they’re real friends, they’ll want you to live your dream life, won’t they?


OK, so you’ve trimmed your budget, kicked off your savings habit, are paying down your debt AND you might even have a little bit of extra income coming in – all with your best cheerleaders supporting you all the way. You are getting closer to your freelance life now. Exciting isn’t it? Remember the end goal when you are tempted by that pair of shoes or you fancy blowing the budget to help you to stay focused. You can always reward yourself when your first freelance gig pays up.


15 Places to Make Savings

Stuck for ideas of how to save money? Here are a few that I’ve tried and tested myself and that work for the family Apricot Ginger.

Go to see movies outside peak times – and take your own snacks with you. Popcorn from the supermarket is far cheaper than paying cinema prices

Invite friends around for dinner instead of going out for a meal – and if you really want to save, you could even invite them around for a pot luck supper where everyone brings their own dish

Join a car club – I did this and it meant we could sell our second car. Some extra money in the bank PLUS money saved on road tax and insurance. And I only use the car when I really need it

Sell stuff you don’t need – get on Gumtree or ebay to sell what you don’t need or want anymore. Gumtree is great for local sales if you’ve bulky items that you don’t want to or can’t post, while ebay is good for pretty much anything

Get stuff on Freecycle – sign up to your local Freecycle site and get things that you need for free. One man’s junk is another man’s treasure and all that. You’ll be surprised what some people are getting rid of

Use charity shops – if you need to restock your wardrobe – or the kids wardrobe – check out your local charity shop. Even better, head to a charity shop in a wealthy part of town – I know someone who picked up a genuine Mulberry handbag for $45 in one!

Swap with friends – maybe you need a babysitter while your neighbour could do with a catsitter in a few weeks time. Instead of both of you paying for these services, you could do a trade

Host a ‘swishing’ party – if you fancy a wardrobe revamp and have lots of quality items of your own that you no longer wear, you could invite your friends round for a swishing party – where they bring their best clothes that they don’t want anymore – and you swap. Invite a crowd of friends, ask them to bring some wine along too, and hey presto, instant party with your girlfriends while you choose new outfits together – and they tell you what suits you too!

Meal plan – decide what you’re going to cook for the week, fortnight or even month if you’re really organized – and never have to rely on a last minute take-away or expensive ready meal again

Shop with a list – if you’re meal planning, this comes as second nature, but don’t go to the supermarket without a list. Make sure you know what you’re going for and only buy what’s on the list

Don’t shop when you’re hungry – you’ll buy stuff you really want to eat there and then

Don’t shop with the kids – they either put things in the basket when you’re not looking or they persuade you that they will eat fruit if you buy that expensive tropical stuff that is 5 times the cost of your normal fruit and veg

Shop in season and use local shops – small shops often have the reputation of being more expensive than supermarkets, but my local fruit and veg shop can often be much cheaper than the supermarket, especially if I’m buying produce that’s in season

Cook from scratch and freeze for later – cooking from scratch is far cheaper and healthier than buying ready meals, which are often expensive and usually packed full of salt, sugar and additives

Train outdoors – quit your gym membership and go for a run, get out on your bike or, if you’re really brave, go wild swimming!


So those are my tips on how to save enough money to quit your job. Please let me know if there are any others that you have and share this post with someone you think might like to read it…

5 ways to budget for home improvements (when you’re self-employed)

budgeting for home improvements

For some of you, the thought of not having a regular salary each month might mean that you can’t imagine ever being able to budget for home improvements. In fact, that fear might be stopping you from quitting the job you hate for that freelance career that you know you will love. But you can budget for home improvements – even without a regular income.

TIP: these work for anyone on a budget – you don’t have to be self-employed.

1. Pay Yourself First

I talked about this in my post about managing your budget before leaving your job as this is a great way of saving money to make the leap into self-employment in the first place.

It’s a habit that you should continue.

In essence, the idea is that, once you have paid yourself what you need for the essentials each month (and assuming that you’re already working for yourself, that includes your tax and National Insurance) you want to put the rest into a savings account.

Set up a direct debit to come out of your current account the day that you pay your ‘salary’ in and make sure that savings becomes one of your essential items.

TIP: Even though I earn money project by project, I still pay myself monthly because I find it easier to manage my money that way.


2. Have a dedicated home improvement account

Once you’ve got into the savings habit, think about having several different savings accounts.

We have a couple for longer term spending needs (ie they don’t get touched unless they really have to) along with one for holidays, birthdays and treats.

We also have another one for home improvements that we use if we have to replace anything or if we want to remodel the kitchen or plant a new veggie garden.

Our home improvement account means that we can save up for big projects that we have in mind or we can do smaller jobs – like painting a room – when we have a few quid in the account depending on what we’ve prioritised.


3. Have a Plan

If you’re just starting out on your self-employed life, chances are that you’ve written or at least outlined a business plan (and if you haven’t, get to it!).

I’m not suggesting that you write out a business plan for home improvements, but you should at least have some sort of a plan where you’ve outlined what needs done, calculated a rough budget for each and prioritised according to what you need versus what you want (as well as taking into account how long it will take you to save for each item).

Get as specific as possible about what you want to do: e.g. remodel the kitchen entirely – new units, appliances and flooring.

Set yourself a budget – do some research to figure out how much all of the things you want to do will cost. Your budget – and the amount of time that you’re likely to need to set that budget – will determine your timetable for the work.

We have a few things we want to do – and a few things that we need to. Some are small: decorate the downstairs WC – while others are definitely longer term and more expensive: completely remodel the kitchen.

I’ve set a rough budget for each of them – and prioritised what needs to be done over what we want to do.


4. Time your spending seasonally

You thoughts might turn to central heating and log burners when the weather starts to get colder, but so do lots of other people – so demand outstrips supply and suppliers can put their prices up.

You also don’t really want to be doing without heating while it’s being installed once it’s cold outside.

More importantly though, when items are out of season, they are often put on sale, because generally less people are buying them but the suppliers and installers still need to drum up business throughout the year.

So if you’d love a log burner, think about getting one fitted in the height of summer (approximately one weekend in July in Scotland althought I believe other countries get a full three months – or even longer!)

Conservatories are always on sale around October/November time where I live as it’s starting to get cold and gardening items are usually slashed to half price around the same time, so stock up on them now to make next year’s gardening cheaper.


5. Don’t try to do everything at once (unless you can afford to!)

If you have some huge projects in mind that will take a while to save up for, it might be worth even tackling a few smaller projects, just to make sure you don’t lose heart and that you can start to see a difference to your home. Even small projects can feel like achievements.

I’m sorry to say that in our house, there are still 3 rooms that we haven’t eradicated the builders magnolia paint from largely due to the fact that we were focused on saving up to get a new kitchen installed (still saving for that one with the aim of doing it in a couple of years).

But that meant nothing else was getting done and the magnolia was starting to drive us both a little bit nuts.

So, now that we have some money saved towards the bigger target as a starting point, we are starting to include some of the smaller jobs, as we can afford them. The magnolia is going this year for definite!

We started off by painting the hall. Although it only cost us £75 for some filler, paint and new light switches, it feels like we’ve actually achieved something, as it totally transforms the space when you walk into the house.

home improvements hallway
We’ve gone from this…
home improvements hallway
to this (although the photo doesn’t do it justice!)






I’m now saving up for a mirror to go on the big wall (the one I like is £300!) and we’re in the process of choosing our favourite pictures to feature in the landing gallery so – mirror aside – we’re anticipating a total spend of £100 for the hall. And, we’re still saving for the new kitchen alongside this – although it might take a bit longer, it will be worth it just for the feeling of doing something – as opposed to just wishing we were!

Want to budget for your next home improvement? 5 essential tips to make it happen Click To Tweet


What tips do you have for saving money for home improvements? Please leave them in the comments below – it’d be good to share a few!

5 ways to prepare your budget BEFORE you leave your job

budgeting for self employment

Is the thought of losing your guaranteed salary crippling your decision to start your own business or start freelancing?

The good news is that you can leave your job for the world of self-employment without risking the house.

I know because 7 years ago, I went from being the main breadwinner in our house to becoming a newly signed up member of the ranks of the self employed.

So, if you’re determined to start your own business – or need to go it alone – what can you do now to help you prepare for losing your salary without risking your family’s financial security?

(By the way, if you’re still undecided about freelancing or self-employment, you might like to take a minute to read 13 reasons why it’s a good idea).


Get a reality check

If the thought of giving up your salary is terrifying, the first thing you need to do is:

Take a good hard look at your outgoings and determine what is really ‘essential’.

This shows you what you actually NEED to earn each month versus your current spending.

And this has the added benefit of:

  1. helping you to reduce your spending to essential items only
  2. showing you how much you REALLY need to make each month once you’re self employed – it’s usually less that you think.

To do this, you need to be really honest with yourself.

Do you need that facial every month? Sure, it’s fantastic ‘me time’ but when you’re starting out maybe it’s time to cut back.

TIP: Give yourself treats in return for achievements. Maybe when you land your first gig you’ll treat yourself to a manicure or a night out? Whatever floats your boat. Just make sure that you can afford it without putting it on your credit card.

With a few cuts, you’ll be able to start saving money while you’re still earning a salary rather than spending everything that you earn.


 A budget is telling your money where to go, instead of wondering where it went. Dave Ramsay


Start a Savings Habit

A penny saved is a penny earned. Benjamin Franklin


Now, you know what you NEED to earn, multiply it by 6.

Now you know how much you need to cover 6 months worth of expenses.

This is your savings target.

This figure will be different for everyone, but setting it aside will make your self-employment journey all the sweeter. And you could decide to put away 9 months or even a year, I’m just suggesting 6 months as a minimum.

While you’re still in the world of employment, start cutting back and put the extra cash away into a savings account.

TIP: If you’re UK based (and you haven’t already saved your total annual limit) consider opening an ISA – either cash or stocks and shares – which has the benefit of allowing you to put aside £15,240 per year tax free.

To save your target more quickly: Pay Yourself First!

When your salary is paid into your account, keep what you need to cover the essentials and then pay the rest into your savings account. Set up a direct debit each month and then you don’t even have to think about it.


Sell, sell, sell

If your savings target is high or if you think it will take you too long to save up (before you go insane in your current job) you can add to the pot in other ways starting with selling the stuff you already own, but don’t use/need/want.

Got old baby equipment? Sell it on Gumtree.

That vegetable steamer you vowed would change your eating habits but which, in reality, has done nothing but languish at the back of the kitchen cupboard? Get it on ebay.

Personally, I sold baby items on Gumtree, went through my garage (several times) and sold items on ebay and probably still have more to sell. Check out sites like Music Magpie if you have old CDs, DVDs or even laptops and smartphones and sell your stuff.

We sold our second car, which made us a few bucks (although it was a banger). This had the added bonus of saving us £450 a year on road tax and insurance. Not to mention the whopping £50 per month that I used to spend on petrol, which I clearly didn’t need, as I now average around £15 per month using the local club car.

I am not an ebay queen or a garage sale guru, but I’ve managed to make a bit of money by selling items we no longer need so you can do it too.


Shop Around

I always shop around for insurance, banking and utilities. As a result, I usually only save a few pounds when I swap supplier – but it’s still worth it because it all adds up.

The good news is that if you don’t regularly shop around, then you’re likely to make even greater savings.

I also switched from shopping in Tesco to shopping in Aldi.

I came late to the Aldi phenomenon (largely because I can’t stand the way that they rush you through the checkout and don’t let you pack at the till – not a relaxing shopping experience).

However, now that I save around £30 a week (yep, a week!) on my grocery bill, I am delighted to have my shopping flung at me as soon as it’s been scanned.


Make it a Habit

As a child, I never quite understood my Granny’s enthusiasm for saving 2p on a tin of peas, but it seems I have turned into her.

My kids have gorgeous clothes (mine aren’t too bad either) and the vast majority of them are bought in sales or on ebay.

Working from home means that I visit our local high street more regularly than before, and I’ve discovered that I can often buy things more cheaply when I shop locally.

Our ironmonger (yes, we still have one) is much cheaper than B&Q for many household items, while the town’s sports shop often has trainers on sale for less that I can get them online. Not forgetting the discovery of a fabulous hairdresser in the next village thanks to asking a few friends who cut their hair.

I’ve actually become slightly addicted to saving money and budgeting.

However, I don’t scrimp and save to the point that we’re miserable. I have done that in the past, but we get fed up and then splurge – usually when we can least afford it.

Now though, we still have meals out, holidays and day trips without running up our credit cards thanks to better budgeting and saving.

Unbelievably, we now have more disposable income than when I had a regular salary coming in.


The happiest people don’t have the best of everything, they just make the best of everything. Unknown


Budgeting doesn’t have to be boring. In fact, it’s pretty liberating.

Read '5 ways to prepare your budget for self-employment BEFORE you leave your job' Click To Tweet


Check out my favourite expert sites on budgeting:

Money Saving Expert – UK site listing ‘best buys’ for banking, credit cards, savings accounts etc. You can also sign up for a weekly email giving you up to date information on where to go for the best deals.

The Wealth Chef – Ann Wilson walks the talk and her blog on investing and blitzing debt is packed full of strategies to get your finances working for you. I refer back to her book ‘The Wealth Chef’ time and time again.

The Frugal Family – A blog all about family life on a budget with fabulous ideas on recipes, thrifty days out and saving money. Her site also has 50 money saving ideas and a free downloadable monthly budget planner.