How to save money and budget now your social calendar is filling up

·10-min read
Photo credit: PM Images - Getty Images
Photo credit: PM Images - Getty Images

In May, when Twitter user Jessica Cisneros wrote: “I forgot how expensive outside is. Wow” it was liked almost 40,000 times with countless comments about daily costs rocketing now the world is opening up again after global periods of lockdown.

It’s a sentiment still being voiced by many in the UK now restrictions have been lifted, taking us from a country locked down to a nation of fun-starved people who can hang out at the bar ordering drinks, go to the theatre and party in a nightclub. Sure, being able to get out socialising again, without limits, after many difficult months has its benefits, but it leaves us with a big question: how do we save money and keep in control of our money management?

As Selina Flavius, finance coach and founder and author of Black Girl Finance notes, it’s important to take a step back and assess our financial situations, no matter how excited we are about the prospect of living it up.

“There’s temptation to do everything, now that you've suddenly got all of these invites and you’re actually allowed [to go out]. It’s about deciding what's important to you. While you can if you want to, you probably shouldn’t do absolutely everything if you want to keep your finances under control,” she says.

“I really hope we all take the time to re-evaluate what we want from life and our money. I think before the pandemic, we were all on automatic mode, so now try to completely reassess your financial situation, you want to start on a blank page,” says Emilie Bellet, founder of Vestpod, host of The Wallet podcast, author of You’re Not Broke, You’re Pre-Rich.

Whether it’s creating a post-lockdown spending budget that actually works, or getting more comfortable talking to our friends about our financial pinch points, here we’re running you through how to save money and spend it mindfully as restrictions ease…

How to save money post-lockdown

The pandemic affected everyone’s finances differently, but a report by the Money and Pensions Service published in May found there has been a rise in the number of money savers, with the increased intention to save seen most dramatically in younger generations. But that could be about to change. “Spending increased sharply after the spring 2020 lockdown, and it is expected that spending will recover to some extent in 2021,” the report said.

If you’re someone who was able to save more in lockdown and you’re now finding that trickier again, it’s important to not worry or be too hard on yourself, especially when circumstances are out of your control.

“Don’t feel guilty, everything's changing as we’re slowly emerging from what's been a very strange time. It’s normal to have an adjustment period. Use the time to re-evaluate your budget, and keeping in mind your longer term goals will help,” says Selina.

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Emilie also urges people to remember that whatever you’ve done in terms of saving over the past year or so isn't the norm, because our lives have been so different.

“We need to go out, socialise and see our friends. Because we managed to maybe save extra during lockdown, it’s okay to now spend some of this money. Once you have goals and a budget it’s about asking: “Where am I today and where do I want to go?’ It’s not about comparing yourself to what you’ve done in the past.”

Budgeting post-lockdown

So, we know now’s the time to reassess our finances, but how do we do that?

Emilie recommends scheduling an hour of your time to look over your past three months of bank statements, really taking in where your money goes, and setting reminders on your phone to check your bank balance more regularly than just the dreaded week before payday.

When looking at your last three months of accounts, check how much you're paying in rent and utilities, then how much money you're spending on your lifestyle – going out, taxis and food deliveries. "Try not to judge yourself in this process. It’s done, so no regrets, but look out for spending patterns and think about the ones you could change,” Emilie says.

Then, she recommends taking time to renegotiate essential costs, whether that’s switching a utility provider or getting a better deal on your phone contract. By doing this, you can potentially save hundreds of pounds a month. Once that's done you can decide, based on the last three months, what is realistic in terms of your spending and saving over the next three to six months.

Photo credit: Peter Dazeley - Getty Images
Photo credit: Peter Dazeley - Getty Images

Now, it’s time to get a budget plan in place. There are lots of different strategies you can try to find the right fit for you now, but if you were using one pre-COVID that worked, maybe start there and see if it still suits. If you need a bit of inspiration, Selina is an advocate of two in particular:

  • The 50/ 30/ 20 rule. Aim to spend 50% of your income on needs (housing, bills, food and travel for work costs); 30% on wants (your fun money) and 20% on saving. The percentages can be tweaked based on things like how much of your income is taken up by essential costs and how much you want to save. Selina recommends that now, as people are excited to socialise, you could lower the savings percentage to free up more money for the things you want to do.

  • Zero-based budgeting. At the start of each month, every pound of income is allocated to different categories, from rent and car money to shopping and saving. “It’s really useful if you have a pots feature in your online banking account. Once that pot is empty, you don’t swap money around and if you’re left with any at the end, put it into savings,” says Selina.

Anna, 27, has been feeling guilty about how much she’s spending now she can leave the house, as opposed to sitting at home watching endless episodes of Grey's Anatomy. To feel more in control, she’s sticking to some key budgeting rules. “I’ve tried to limit the amount of spontaneous activities I do, but that can be hard. My savings account is a Triple ISA which isn’t the best for racking up interest but I can only access it three times a year so it does definitely help with not being able to dip into savings. Also, on Monzo you can hide your pots of money which I’ve found really helpful – it’s out of sight, out of mind and I forget it’s there for me to dip into,” she says.

Photo credit: Prasert Krainukul - Getty Images
Photo credit: Prasert Krainukul - Getty Images

It’s important to note that being super organised with money isn’t easy at the best of times, let alone after a period when lots of people have experienced issues like redundancy and furlough. If things have been tough and you’re struggling to get back on your feet with budgeting and saving, remember there are services that can provide support.

“The Financial Conduct Authority, particularly over this period of time, really wants to make sure that financial services are supporting struggling customers and vulnerable customers as much as possible, but do reach out to see what support organisations may be able to make available for you,” advises Selina. “Citizen’s Advice and Step Change are two organisations that can help and you can look into any government support that you may be able to get. Knowing what help and support is available to you is important.”

Socialising post-lockdown

When restrictions first started to lift, Paige, 28, was being more reckless than usual with her money, splurging at restaurants and getting cabs home, but as more friends became comfortable socialising, the pounds started to add up.

“I’m now finding myself looking at a menu or choosing an activity thinking about cost rather than what I want to do. I’m going back to looking for offers online and happy hour deals. But sometimes, in the moment I think: ‘It’s fine, I’ll stick it on the credit card’ and this month, I don’t have the money to pay that credit card off until I get paid. I’m now at the point where I have plans but not the funds to pay for them so I’m going to have to use the credit card. I’ve never been one to be in debt, even at university, so I know I’ll pay it off, but it’s a recurring cycle,” she says.

“I’m worried about that our generation, who want to get out and socialise because we’ve been so restricted, are going to get into debt by spending so much money now.”

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It’s a common dilemma – desperately wanting to have fun with friends and family after so long apart, but not wanting to slide into difficult financial situations. But what can we do to avoid overspending in a way that feels out of control?

Selina advises thinking carefully about your priorities and being honest with loved ones about why you might not be able to do everything.

“Make a list of the events you absolutely don't want to miss out on, then a list of things where it would be understandable if you couldn’t go,” she says.

“It may be a case of having to say to a friend: ‘Look I've got this really important money goal [which you can outline], which means that I do have to cut back and I'm unable to do everything. I want to be there and I’m going to be there in spirit, but it might not be feasible because of the financial goals I want to achieve,’” Selina advises. “Be mindful of the goals you’ve set for yourself and don’t be afraid to talk to other people about them. COVID has given a lot of people time to reflect on goals, hopes and dreams… so being able to articulate them, if there is a situation where you feel peer pressure, is important.”

As for the events you do say yes to? Emilie has some advice for how to attend them and spend money mindfully...

  • Move money out of your bank account into a savings account without a card attached, so if you really need money you have to go to the bank with a passport or ID. This will prevent you from spontaneously dipping into savings while socialising.

  • Leave your cards at home, delete your cards on Apple Pay and take only the cash you want to spend, whether that’s £20 or £100, to help you stick to your original budget.

  • If you are in a more privileged position or feel you have more money to spend than your friends, be mindful about their financial situations. This doesn't need to be an explicit conversation, but it could be giving three restaurant options to the people you’re going out with, ensuring there’s at least one cheaper option.

It’s clear that for our social lives, this is a time of real change, and that's being mirrored in our relationship with money. But as the experts have explained, using simple steps you can take charge of this moment and make it work for you as a positive reset.

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