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With the current uncertainty in the UK and world economy perhaps there has never been a better time to start saving or investing for a rainy day. But how do you go about budgeting, and what options are available to you and your family today? We have enlisted the help of TV finance expert Jasmine Birtles to answer some questions submitted by bloggers that their audiences want answering.


Jasmine Birtles
Our Expert

Jasmine Birtles is a financial expert, TV presenter, author, journalist, business commentator and humourist. Her mission is to de-mystify money and help people get out of debt and manage their finances by spending less, making more and investing for a secure future.

I can only save £10 per month, should I save or treat myself?

Ultimately it is up to you, but I’d go as far to say that it is possible to do both if you really wanted to. It’s a good feeling to treat ourselves, and it also feels good knowing that you’re saving or investing for a future treat, too! Don’t worry if you can only put £10 a month aside. That could get you off to a great start! Putting even a little away each month could add up to a useful cash sum for a future treat.

If you decide to invest your money, one way to do it is via an Investment ISA, which gives it access to the long-term growth potential of the stock market. Also known as Stocks and Shares ISAs, these products invest your money in the stock market in, for example, funds that are linked to the stock market or a combination of, stock market, property and cash investments.

As with all investments, if the market is not doing well, the value of your investment will fall, but the market can go up too, as would your investment. Depending on the performance of your investment, you could get back less than you have paid in.

You might decide that you want to spend your £10 each month on small luxuries but if not, here are some free ways to have fun now that won’t cost you a penny. For example, get free meals out by becoming a mystery shopper (get a free ebook on how to do that here, do some neutral shopping where you sell things online to give yourself cash to spend on fun things. Also, have a swap shop with friends where you swap things you don’t want anymore so you get rid of junk and, at the same time, bring in nice new things into your wardrobe.

What options are there for savings or investment plans to start putting money away for our children’s future

When it comes to putting money away for your children’s future, there are a number of savings and investments options available to parents these days.

Junior ISAs are a popular way to invest for your child. You can put up to £4,080 a year into them and although the Government doesn’t add in the tax you would have paid, all the gains your child makes on it are tax-free once they take the money out. Cash Junior ISAs may be good for teens as they don’t have long before they can draw the money, so you might want to consider putting it into something stable. But for younger children, because they have more years for the ups and downs of the stock market to smooth out, an Investment ISA might be worth considering, too.

Please remember that as with all stock market investments, the value of your investments can fall as well as rise, so your child could get back less than you paid in. Tax treatment depends on individual circumstances.

For Investment Junior ISAs, tax-free means the policy grows free of income and capital gains tax (other than tax on dividends from UK shares). Tax-free in relation to a Cash ISA means you don’t pay tax on any interest earned on your savings. Tax law may change in the future.

Children’s savings accounts are not only another savings vehicle, but they could also offer a great way for children to learn how to manage money and help get them into the savings habit. You can open an account from as little £1. If you were to set up a monthly savings plan, you may be surprised how much it will add up over time.

What is the best way to start budgeting?

Firstly by doing an actual budget! You can do it online – there are lots of good ones on the net – or you can do a rough one on the back of an envelope.

If you do it yourself, just do two columns, one for the money that comes in each month (salary, benefits, other income) and the other for the money that has to go out each month like your rent or mortgage, utility bills, insurance, basic amount for food, clothes and travel. Then add up both columns, take away the ‘outgoings’ amount from the ‘incomings’ amount and you know how much you have to play with each month.

You could then see how you can bring your essential outgoings down by switching your utility providers and maybe replacing a TV package with Freeview. Once you have reduced your outgoings do the budget again and see how much more money you have to play with each month!

How do Investment ISAs rate as an investment?

Investment ISAs are dependent on the stock market for growth. The returns may be higher than cash savings over the long term but you must also remember that unlike a secure cash savings account, you could get back less than you have paid into it

With Investment ISAs you don’t pay tax on the gains you make. This means the policy grows free of income and capital gains tax (other than tax on dividends from UK shares).
Of course, like anything, the amount of money you make depends on the success of the product that you have invested in. Some funds do better than others and it’s not always easy to know which ones will do well and which won’t.

Index-tracking funds for example offer a way of investing which tracks the UK stock market or you could choose a fund that is actively managed. This is only an example of two funds and there are many others available that you might want to consider. If you’re not sure, but you would like to invest in a stocks and shares fund, then you could speak to an independent financial advisor who will give you a range of possibilities based on your situation and your appetite for risk.

Again you must consider here that the value of your investment can go down as well as up so you could get back less than you have invested.

What is the best way to save money on food shopping? Should I shop at budget stores, buy value ranges or just cut back?

A bit of all of those things is a good mix. The ideal is to cut down on cost while maintaining a healthy diet. Here are a few things you can do to eat healthily but cheaply:

  • Cook from raw where possible. Takeaways and pre-prepared meals are expensive and often unhealthy. If you cook simple meals from raw it will be cheaper and, ultimately, healthier.
  • Try the ‘value’ version of anything you normally buy. Many of them are just as good as more expensive brands, but make sure they’re not a false economy. For example, sometimes ‘value’ bin bags can break easily so you have to use two at a time which will end up more expensive.
  • Shop at cheaper supermarkets, but watch out for pound shops. Quite often the items they sell for a pound could be bought for less in a supermarket.
  • Use your local street market, particularly at the end of the day. You can often pick up whole boxes of fruit or veg at a knock-down rate which you can then use for soups or stews or cook and freeze for later.

In what ways do you haggle?

There are a few things you can do to haggle in shops:

  • Do some research on the net before you go into the shop. Find out what other companies are charging for the item you want. Tell the shop you would prefer to buy from them so could they match the price?
  • Make sure you speak to someone with the authority to give you a discount. It might be the manager or the owner.
  • If they won’t give you a discount, see if they will throw something in for free instead. Sometimes shops are happier to do that.
  • Be friendly and keep a smile on your face as you ask for a discount. Even if they refuse, stay friendly and pleasant.

How can you ensure decent savings each month?

Pay yourself first each month before you spend on fun things. Work out (from your budget in point 3) how much you can afford to save each month then set up standing orders from your current account to go into savings and investments at the beginning of the month, when you pay your usual bills.

This way you will make sure you put money away for your future self each month and you won’t be tempted to spend it before investing it. Your savings and investments could grow without you even noticing it and very quickly you will be used to living on a bit less each month and you won’t even notice the difference.

How do you find the balance between saving money and living?

First work out how much you have to spend each month just to keep everything going (that’s the benefit of doing a budget, as in point 3). Then you could aim to set aside at least 10% of your income each month for savings and investments. You could aim to put in more as soon as you can afford it particularly as you get closer to retirement. Once you have set up standing orders each month to put money away for your future then you can happily spend what is left over, knowing that you are saving and investing first.

Also, if you don’t think you have enough money left for treats, find ways to make extra cash on the side to pay for the fun things in life. There are lots of things you can do depending on what time and skills you have. We have loads of ideas for making money at so take a look there!

No advice has been provided by Scottish Friendly. If you are in any doubt as to whether a savings or investment plan is suitable for you, you should contact a financial adviser for advice. If you do not have a financial adviser, you can get details of local financial advisers by visiting Advisers may charge for providing such advice and should confirm any cost beforehand.