A thrifty student has revealed how she saves £1,800 ($2,188) a year—by paying herself “pay packets” to stop herself from overspending.
21-year-old Emma Cutler from England has adopted some cost-saving measures to “plan for the future” and ease the burden of university costs.
Ms. Cutler gets three £3,000 ($3,645) student loan payments a year—and separates the money into pay packets when it reaches her bank account.
The third-year media and communications student at Loughborough University has a packet for bills and rent and splits the remaining money between food, nights out, self-care, and other miscellaneous spending needs.
To stop herself from overspending, Ms. Cutler uses online saving pots and cash.
Originally from Birmingham, Ms. Cutler, who does content creation for the university’s social pages, said: “I’m probably saving a good £150 [$182] a month.”
She further revealed a breakdown of her costs. Her rent amounts to £550 ($668) per calendar month. She then puts aside £120 ($145) for groceries, £30 to £50 ($36 to $61) for her miscellaneous spending money pot, and £50 to £80 ($60 to $97) for self-care.
She’s noticed some benefits of budgeting this way.
“It stops unnecessary spending, and it makes you think twice before you buy something,” she said.
Over the last three years, Ms. Cutler has only gotten better. During the first year, she was only focused on making sure that she could afford rent. However, now she thinks more about the future and has long-term plans.
“I’ve developed my own way of budgeting and knowing how to save for things coming,” she said. “I always look at what my income is going to be for the month from the loan and my work as well.”
She revealed that sometimes she has difficulty as she gets her money in three installments. However, she’s learned to overcome that by working out the average of each month.
“University throws you in at the deep end, and you have to start paying for things,” she said. “At that age, a student loan is a big sum of money for the first time.”
After working out how much she can spend in a month, Ms. Cutler splits up her money, carrying over to the next month whatever she doesn’t spend.
“I prioritize bills and rent and then break it down into the four categories,” she said. “After that, I have longer-term things like luxury items and holidays.”
This way, she has a budget to navigate with and knows what she’s spending.
“[E]ven for things like Christmas, I know I can put £10 ($12) away for that, and it doesn’t feel like I’m spending a lot when it comes to buying presents,” she said. “It takes away the pressure and guilt of spending a lot of money if I know I’ve saved for it—it’s more controlled spending.”
She has been able to swap from using cash more often to now making use of Monzo, an online bank based in London.
“[I] put everything into pots, and it rolls over to the next month, so you can make up for quieter months,” Ms. Cutler said.
Other than dividing her money, she cooks all her meals in batches and completes online surveys to top up her income.
“A lot of the meals that I do—spaghetti bolognese and curries—I make two or three portions at a time, so I can freeze and reheat,” she said.
When it comes to nights out, Ms. Cutler chooses not to buy many drinks. Instead, she opts to drink at home beforehand. Additionally, she also takes her own coffee into lectures instead of paying £4 ($4.86) at Starbucks.
By prepping lunches for school, she doesn’t have to use the canteen.
Aside from her content creation—which she does for her university’s social pages—Ms. Cutler also does yearly surveys and sells her clothes on Vinted, an online platform to sell, buy, and exchange new or secondhand items, mainly clothing and accessories.
Ms. Cutler is also thinking ahead to the future, with one of her pots dedicated to life after university.
