Transcript of ACCOUNTANT EXPLAINS: How to 3x Your Savings in 30 days

in this video I'm going to walk you through six simple but effective strategies that will help you keep more money every single month without having to give up the things that you enjoy so if you're saving for your first big milestone whether that's 1,000 5,000 10,000 or even more will cover ways to get there faster if you're new here hi I'm Nisha I'm a qualified accountant and a former investment banker and on this channel we talk about all things personal finance and self-development starting with strategy number one the think wantd do framework studies in behavioral economics show that most people underestimate their monthly spending by 25 to 40% that's not just a small mistake that's a blind spot that could be stopping you from making real Financial progress so the think want to do framework helps you bridge that Gap by breaking down your money habits into three parts first you write down what you think you spend by category then you write down what you want to spend by category and then what you do actually spend there are two key reasons why you want to do this if you're really laser focused on Saving right now first the do section that gives you a starting point that's rooted in reality without knowing this number without knowing what your actual spending pattern is you won't be able to apply any of the other saving tips that we talk about in this video effectively second when you regularly compare what you think you spend and what you actually spend you notice the difference your brain starts fine-tuning your financial instincts this creates a natural feedback loop where you become more aware of your habits and therefore you start making better money decisions as a result give this a go for the next 30 days and see how more conscious you become about your spending habits and how you're spending number two Let technology do most of the hard work for you when we're trying to focus on building a new habit there's almost always some sort of app or technology that will help make building that habit faster so if you're trying to reduce your social media consumption there are apps like on SEC or opal that creates friction between you and opening up a social media app if you want to improve your Fitness and there are apps that will help you do that in the same way if your focus right now is to save more money you want to lean into technology and use apps that work with your natural tendencies there are loads of different apps that will help you do this I personally have been using Plum for a while now and they saw me raving about them in a video that I posted over 6 months ago and offered to sponsor a video on the channel and I'm super excited about that because it is one of my favorite apps it's a smart money app that pretty much automates both the thinking and the action of saving one of my favorite features is called brain and the way it works it analyzes your spending over a specific period and then estimates how much you can afford to save it then automatically transfers that money into another account every few days continuously updating to stay in line with your financial habits you can also adjust your settings and set your mood to tell Plum how confident you're feeling whether you want to stay chilled or whether you want to go into beast mode and then reflects that in the automated transfers that it's making and this is completely free it's available in its most basic version to add to that it has a bunch of saving challenges that make it so much easier to put money aside without thinking about it so they had this 52 week challenge that's going on where you start by Saving 1 in the first week 2 in the second3 in the third and what feels like nothing really adds up to a big amount over time without you changing your lifestyle you can then open up a cash Isa within the plum account it's currently paying 5.04% at the time of recording this video and in that you could save up to £20,000 and earn interest completely taxfree I've tried a lot of apps but the key is to find one that makes saving frictionless for you whichever one that might be if you do want to check out Plum they are also offering a £25 bonus for the first 25 people who sign up using my link and start depositing in a plum cash Isa today just head over to the link on the screen or in the description next we have make it emotionally accessible when I was saving to buy my home I had set this huge goal it was like save 10,000 or 20,000 for a house deposit and I set that goal and then nothing happened I got overwhelmed and ended up not knowing where to start and there is a word for this psychologists call this goal overwhelm your brain just shuts down because it can't process how to reach such a massive number it's like telling yourself to climb Mount Everest with no training or no gear what you really want to do is break that Big Goal down into something smaller not just to make the math easier but because it makes the whole process feel a lot more motivating and achievable so to give you an example say you want to save 10,000 instead of focusing on that 10,000 break it down so this means in a week you need to save 193 or in a day you need to save 27 suddenly you're able to actually understand what you need to do as part of your daily routine to hit that goal maybe it's skipping that coffee or taking meal prepped food from home to work and you can visibly see the that you'll be saving and to take it one step further if saving 10,000 in a year still feels impossible at 27 a day don't change the goal just stretch out the timeline spread it over 18 months now that's just 18 a day or save it over 24 months that's 14 a day you can keep going until you get to a place where instead of saying this is impossible you realize wait I can totally do this and the key is just to break it down into manageable bits number four pay off high interest rate debt first a lot of financial advice tells you to add new habits but sometimes the smartest move you can make is actually to eliminate something first so let's break it down with an example say you have 5,000 in credit card debt at 18% interest and 5,000 sitting in a savings account earning 4% interest after a year your savings would earn you 200 but the interest on your credit card would cost you 900 that means you're actually losing 700 it's like trying to fill a bucket while there's a hole at the bottom your saving might grow a little but your debt is going to grow way faster you're going to be out of pocket quicker what you really want to do is first use your savings any savings that you have right now to pay off that high interest rate debt first once you've paid that off then you want to redirect the same money that you were using to pay that off into savings and Investments it might feel counterintuitive because it feels so nice to watch your savings pot grow but actually getting rid of high interest rate debt first will put you ahead way faster then we have do what's easy first you don't have to buy that thing it sounds really obvious but a recent survey by Lloyd's Bank found that the easiest areas people caught back on when trying to save money were eating out alcohol clothing and take away coffees all of these are what we call discretionary spending things that you choose to buy but you don't actually need so now that you're aware of this what are some of the things that you could do firstly cooking at home instead of dining out wearing what's already in your wardrobe canceling subscriptions that you barely touch and let's say you don't want to cut back you don't want to change your lifestyle and you enjoy all of the things that you spend on then you want to ask yourself the most important question and that is how can I get the same thing for Less take car insurance when was the last time you actually compared quotes you probably hear this advice all the time but when did you last search on a comparison site like money Supermarket or compare the market because that could save you hundreds for the exact same coverage the same applies to your Broadband to your phone bill to your energy provider often all it takes is one phone call to ask for a better deal things are always changing in personal finance there's always new things and new hacks available you can always subscribe to this channel I upload videos every Sunday and we cover up-to-date topics on saving money making money and everything in between and number six ask for a pay rise and if that doesn't work it might be time to switch jobs I can't say this enough switching jobs has been one of the most reliable ways to increase your salary and I say this having experienced firsthand I have a video on my channel walking you through all of my numbers over the last nine years in banking and I have the same post on Instagram as well here's how I see it if you love your job if it gives you purpose it gives you stability it gives you peace of mind and you rather not move even though your salary isn't quite ideal that's completely valid and you shouldn't feel like you have to move just to get paid more if there are other things that your job is offering you but it does mean accepting that your financial goals might take a bit longer but if you don't love your job it doesn't fulfill you and you are there to make money that funds your life outside of work which is where you get most of your happiness then you owe it to yourself to squeeze everything you can out of your job and that often comes from moving up the corporate ladder or moving out to another job don't estimate the importance of this side of the equation because you can only save as much as you earn but you can always earn more and those are my current top six saving habits if you like this video you will love this one right here it takes the lessons from today one step further by actually tracking your spending in real time and doing it in a way that feels fun and not like a chore thank you for watching and I hope to see you there