Saving for your dream trip
The secret to saving for your great bicycle getaway is surprisingly simple: live beneath your means.
Charles Dickens expresses this well in his famous novel David Copperfield, when the character Mr. Micawber says:
“Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
Even in London, one of the world’s most expensive cities, we saved a surprising amount and put ourselves in good shape for a big trip by following this age-old advice. Some of the techniques we used included:
- Only Spending Money We Had – We didn’t use credit cards to bridge the gap between our desires and money we didn’t have. Mostly, we used competitive zero percent interest deals from credit card companies to earn money by stashing the equivalent of what we spent in a savings account until the bill had to be paid and earning interest on our money in the meantime. We paid off the card at the end of the zero percent term and collected the interest for ourselves.
- Being A Competitive Consumer – We frequently changed suppliers to keep utility bills as low as possible and only renewed our wardrobe during sales, when we could pick up clothes at a fraction of the full price.
- Eliminating Luxury Expenses – Why take a taxi when public transport will get you there? Ditch the car if at all possible. Giving in to gadget temptation can also eat away at your savings. When we did purchase something like a mobile phone, we went for simpler, less expensive models.
- Saving on Food – We brought our lunches to work and rarely ate out in restaurants, preferring to cook almost all our own meals. We also tried to cut down on expensive meat, focusing on more economical things like lentils. When we did buy meat, we waited until it was reduced in price and then bought a lot at one time to put in the freezer.
- House Downsizing – We purposely purchased a house that was beneath our means so we wouldn’t feel stretched each month.
- Setting A Top Bank Balance – We decided on the maximum balance we needed to keep in our low-interest chequing account. As soon as we exceeded our agreed float, the extra was used to overpay on our mortgage or was transferred to more profitable savings accounts and other investments. This way we were never tempted by a big bank balance to buy something we didn’t need.
- Participating in Company Pension and Share Purchase Schemes – These are almost always excellent value, as the company usually makes a contribution that adds to your efforts.
- Claiming Expenses – We found it amazing how many people forgot to claim work-related expenses back from their employer.
Of course, even when you’re saving for a big goal you need a luxury now and then. It’s no good to stash away heaps of cash while making yourself miserable. We singled out a couple areas which gave us great pleasure and didn’t worry too much about spending when it came to having a drink with friends after work or going on holidays. If we’d been too strict about never enjoying ourselves, we’d have given up on saving altogether before long.
%7Cutmccn%3D(direct)%7Cutmcmd%3D(none)%3B%2B__utmv%3D52502776.-%3B)