Try the en­ve­lope method

Prima (UK) - - Advice For You -

Up for a big­ger sav­ings chal­lenge? Ramit Sethi, au­thor of I Will Teach You To Be Rich (Yel­low Kite, £16.99), claims that if you go cash-only for daily liv­ing ex­penses for a fort­night, you’ll save up to 18% on your usual spend­ing. To help you bud­get, try the ‘en­ve­lope sys­tem’. Sim­ply di­vide a set amount of money among en­velopes – one for your gro­ceries, one for travel, one for eat­ing out – and only spend from th­ese. How much you put into each en­ve­lope de­pends on your per­sonal bud­get, but it boils down to work­ing out what you have to pay for, and then fig­ur­ing out how much you have left to spend on the rest. The bud­get­ing plan­ner on the web­site mon­eyad­vice­ser­vice.org.uk is bril­liant for get­ting started. TIP Take cards out of your purse so you can stick to the rule: ‘When it’s gone, it’s gone!’

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