Budget backpacker to savvy saver!
My mum recently moved house. As she was clearing out her ‘junk’, she stumbled across a diary which I kept whilst backpacking. This wasn’t just a diary which told of my journey around the World. It was actually the start of a very different journey. A journey that would teach me budgeting, spending wisely, and knowing when to spend and when to save. It would take me from sleeping (for a night or two) in a bed for £3 a night, to allowing me to achieve things in the 8 years since that I could not have ever imagined.
I spent 2 years saving whilst studying and working part-time, skimping together every penny I had. I couldn’t rely on family to ‘bail me out’ if I ran out of money in the middle of Malaysia. So, I put together a plan of how much I would spend each day in each place.
The daily budget
This ‘daily budget’ included a bed for the night, food and drink, and travelling to the next place (excluding flights between continents). I had £20 a day in Asia, £45 a day in Australia and Fiji and £35 a day in South America. I was strict – I didn’t want to blow it all having a good time in Thailand (which was the first place I went), only to find that I couldn’t fully enjoy the experience of Brazil (which was my last destination) – or worse, have to come home early!
Ever since returning from this trip (with some money to spare believe it or not), I have kept a budget – and a strict one at that. I work out exactly what I have each month and how I am going to spend this. The amount I have earnt each month has changed over time, quite significantly in comparison to the start but the process is always the same. I always start with my bills – no exceptions – all of my bills are paid within a few days of being paid. Then, my savings – going travelling gave me the ‘bug’ and I have always enjoyed spending my money on holidays, so a lot of my ‘savings’ go on this. After savings, my spending money. Anyone who tells you that you should save every penny is not living in the real world! We must enjoy ourselves and spend the money that we have earnt. For me, by paying my bills and putting money into savings first, I genuinely feel as though I enjoy that ‘spending money’ more
Fast forward 8 years from my diary (which I hope to publish one day), I enjoy the money I earn. I have also been able to stay debt free and to save enough to buy my first home, upsize and have my wife’s dream wedding. I have also become a father to my beautiful daughter.
Proper planning and a good financial structure will give you the best possible opportunity to achieve your goals sooner than you think. It is never too early to get into good habits, and you are never too old to allow these to continue.
As boring as having a budget sounds, it has allowed me to (so far) lead anything but a ‘boring’ life.
A blog post by Nameer Al-Asadi
Nameer (Naz) is a Chartered Financial Planner at Sheafmoor Money Management Ltd in South Yorkshire.
He has delivered a number of My Personal Finance workshops at local Secondary Schools. Naz is very passionate about the importance of Financial Education for young people and believes that this is a life skill which should be taught more widely and which would ultimately benefit tomorrow’s society as a whole.
For more on the above and other money subjects, check out the Your Money Matters here.