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The first thing from my bucket list that I wanted to complete was to start my own retirement fund. This fund isn’t actually anything special – I have started it with a standing order which is transferring £25 at the start of every month into a newly created online-savings account. The standing order would currently deposit a total of £300 per year into my ‘retirement fund’. Along with this I have a savings scheme running (that my bank calls ‘save the change‘) which rounds any of my debit card transactions up to the nearest pound and deposits the additional funds into a nominated account. For example, if I was to purchase an item for £0.86, £1.00 would be taken from my main account. £0.86 would be used to pay for the item and £0.14 would be automatically moved from my main account to my savings account.
At the time of writing, this savings account contains a grand sum of £63.09, which is money I would have probably otherwise spent on other things. Over time I am hoping to be able to increase the monthly standing order to a more respectable sum in order to accelerate the growth of the deposited money.
Have you started paying into a long-term savings fund? Do you pay money into a pension scheme? I’d like to hear what other people are doing to prepare themselves for the future.
Hi Darren
A retirement fund is a great idea. I’ve been doing the same for about a year now. I save as much as I can into it, split 50/50 between investments and an emergency cash pot.
The idea of having an emergency cash pot is so that I can get cash quickly if I need to (a reason why many people cash in investments early). That way, I can leave my investments for a long time.
I don’t have much to play with yet, especially as my IFA recommends an emergency fund of £10,000! Going to take aaaagggeesss.
Dan
Thanks for your comment Dan.
Wow, £10k would take me an age to save up. With me saving this little bit each month it makes me feel like I’m at least making an effort.
I’m hoping to get to the point where I’m putting two thirds of my wage away into savings, still living in my parents home leaves me plenty of opportunity to cut my own spending, I just need to get more serious about it.
Darren
Yeah, it’s getting into the habit that’s important. Whenever I sell something, I put 50/50 into savings/spending money. The more you do it, the prouder you’ll get and the more precious you’ll be of your stash
Dan
My total ‘stash’ is sitting around £2.5k at the moment, so I’ve got a long way to go.
I’m just awaiting the time when I decide not to buy something because my savings are about to hit a certain level. The emergency £10k would be ideal, but I doubt I could make it last too long!
Darren
Darren,
You just have to keep putting a small amount each month into an account – better still you would be better off putting it into a specific ‘retirement fund’ assuming there are perks you get like here in Australia. Otherwise perhaps a managed fund which works well over the long term with dividends and compounding interest etc….Good luck and keep it going!
Thanks for your comment Geoff.
I’m sure there are ‘retirement fund’ opportunities here in the UK, but I haven’t had the time to look into them. For now, mine has been set up in an online savings account, separate to all my other savings.
Darren