I’m 21 but have saved £1.8k a year thanks to a clever ‘pay packet’ hack – anyone can do it, you just need to be strict
A savvy student has revealed how she saves £1.8k a year – including paying herself ‘pay packets’ to stop overspending.
Emma Cutler, 21, has adopted some cost saving measures to “plan for the future” and ease the burden of university costs.
She gets three £3,000 student loan payments a year – and separates the money into pay packets when it drops into her bank account.
The third year Media and Communications student at Loughborough University has a packet for bills and rent and splits the rest between food shopping, nights out, self-care, and miscellaneous spending money.
She uses online saving pots and cash to stop herself from overspending.
As well as dividing up her money, Emma batch cooks all her meals and completes online surveys to top up her income.
Emma, who does content creation for the university’s social pages, originally from Birmingham, said: “I’m probably saving a good £150 a month.
“My rent and bills are £550 pcm and then I put aside £120 for food shopping, £30-50 for going out, £30 in my miscellaneous spending money pot and £50-£80 in self care.
“It stops unnecessary spending and it makes you think twice before you buy something.”
Emma explained that she’s gotten better at it over the course of three years.
The first year, she focused on paying her rent, but now she’s thinking long-term.
She continued: “I’ve developed my own way of budgeting and knowing how to save for things coming.
“I always look at what in my income is going to be for the month from the loan and my work as well.
“It can be difficult as you get it in three instalments so I work out what the average will be for each month.
“University throws you in at the deep end and you have to start paying for things.
“At that age, a student loan is a big sum of money for the first time.”
After working out how much she can spend a month, Emma splits up her money, allowing her to carry it over to the next month if she doesn’t spend it.
She said: “I prioritise bills and rent and then break it down into the four categories.
It stops unnecessary spending and it makes you think twice before you buy something
Emma Cutler
“After that I have longer term things like luxury items and holidays.
“It gives me a budget on what I’m spending on and even for things like Christmas I know I can put £10 away for that and it doesn’t feel like I’m spending a lot when it comes to buying presents.
“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.
“I used to use cash more often but now I use Monzo and put everything into pots and it rolls over to the next month so you can make up for quieter months.”
Emma also cooks all her meals in batches, something she says she learnt to do throughout university.
She said: “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.
“I always meal plan before I go to the shops and I didn’t do that in the first year and I’d end up spending £30 and wouldn’t have any meals for the week.”
When it comes to a night out, Emma chooses not to buy many drinks, instead she opts to drink at home beforehand.
She said: “That’s something we always did in first and second year – you don’t have to buy many drinks at the club if you pre more at home.
“I also take my own coffees into lectures instead of the £4 from Starbucks to save money.
“And prepping lunches is a good if you know you’re going to be there for the day so you don’t need to use the canteen.”
Aside from her content creation – which she does for her university’s social pages – Emma also does yearly surveys and sells her clothes on Vinted.
Emma's monthly plan
Rent – £400 a month
Bills – £150 (inc subscriptions)
Food shop – £120 a month
Going out – £30-50 a month spending
Misc – £30
Self-care £50-£80
Emma is also thinking ahead to the future, with one of her pots dedicated to life after university.
She said: “I do the content creation every few weeks when the uni have a project on – they pay me around £10.40 an hour.
“I haven’t thought about investing but I’ve got a help to buy ISA and have one main savings pot aside from the little ones and that’s for a house deposit or something to fall back on if I’m renting.”
Money Emma sets out in her plan each month: Rent – £400 a month B