How I Lived On 10p A Day

One smart skinflint managed to spend just over £3 in an entire month. We show you how he temporarily became a wiser miser!

"When money gets tight, the tight get going!" (Cliff D'Arcy, 2006)

Every so often (at least once a year), I test my willpower with a bout of extreme budgeting.

This involves a one-month financial detox, during which my goal is to spend as little of my disposable income as I possibly can. As you can see, I've improved my personal best considerably during my three latest 'miser months':

Of course, I didn't actually survive on ten pence a day for a month, because I'd be a walking skeleton by now! The above spending doesn't include any regular bills which I pay by standing order or direct debit, such as my rent and Council Tax, plus bills for utilities, childcare and groceries. In effect, what I'm cutting back on is the hundreds of pounds which I spend each month on . well, nothing much at all!

As you can imagine, extreme budgeting doesn't leave much room for the finer things in life, so treats, sins and vices go out of the window. Hence, this means little or no 'personal spending', so no alcohol, tobacco, drinks and snacks, fast food, takeaways and eating out -- in short, a complete financial and physical detox. What's more, extreme budgeting means no flashing your plastic: I avoided using my bank and credit cards for an entire month, making my statements much shorter and easier to check.

In addition, wholesome living and resisting temptation paid off with improvements to my physical and mental well-being. As well as spending fewer pounds sterling, I shed several pounds in weight, plus my energy levels and sleeping habits improved, leaving me feeling fighting fit. Another benefit was that having more free time enabled me to write more articles, which boosted my earnings because I work for myself. Extreme budgeting is a win-win situation all round!

Then again, I appreciate that extreme budgeting isn't to everyone's taste, because it's a real test of willpower (especially going cold turkey from smoking and drinking). Also, many people would struggle to abandon their lives as capitalist consumers and social animals. Indeed, I'm happy that I work from home, because I'm not forced to walk past parades of shops every day on my way to work -- there are no cafés or coffee shops on the climb up the loft ladder to my study!

Even if extreme budgeting isn't up your street, it's sensible to spend (or, ideally, save) yesterday's money today, instead of spending tomorrow's money before you've even earned it. Here are four ideas to help you to get a better grip on your spending, especially when money's tight:

1) Keep a spending diary

On average, we Brits spend £110 for every £100 of take-home pay, which is a recipe for financial ruin. By monitoring your spending with a spending diary, you can keep an eye on where all your money goes, plus the very act of recording your expenses discourages you from spending and reduces your outgoings.

2) Try plastic-free and spend-nothing days

With tens of thousands of cash machines and hundreds of thousands of retail outlets in the UK, it's oh-so-easy to get your hands on some cash or go on a spending binge with your plastic. However, every now and then, it pays to wean yourself off your addiction to spending on plastic. Cutting back on your cash-machine habit and plasticmania through 'plastic free' and 'spend nothing' days certainly helps to curb any over-spending.

3) Try the 10% game

Let's say that your personal spending adds up to £400 a month. A tenth (10%) of this figure is £40, which you should aim to knock off next month's spending, and the following month's, and so on. After just five months, you've halved your expenses and have an extra £200 a month to pay off debts or save! These 25 money-saving tips will help.

4) Kill your interest bill

With the average British household owing almost £8,500 in non-mortgage debt (including credit and store cards, personal loans, overdrafts, student loans, etc.), we're paying tens of billions of pounds a year to lenders in interest alone. By using a top 0% on spending credit card and taking advantage of Best Buy 0% balance transfers, you can slash your interest bill to zero. This break from interest provides an excellent opportunity to tackle your debts head-on.

Here's to spending on the things that really matter, rather than spending for spending's sake!

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