The Vault with Financielle - UNLOCKED: Why You’re Sh*t at Saving Money (And How to Fix It)

Episode Date: January 20, 2025

Send us a text💸 Welcome to The Vault Unlocked – a special bonus series of The Vault Podcast, where we deep dive into the big money topics no one wants to talk about.In this episode, we’re tackling the topic of emergency funds—the ultimate financial safety net. We explore why so many people struggle to save, unpack the psychology behind spending vs. saving, and share actionable steps to build an emergency fund from scratch.Whether you’ve got £0 saved or you’re ready to level up your fund, you’ll leave with practical tips and motivation to protect yourself from financial surprises. Let’s rewrite your money story, starting today. Have a topic you’d love us to unlock next? Email us at [e-mail] Subscribe to Financielle for honest conversations about money, and let’s rewrite your money story together.Download the Financielle app and start reaching your money goals today! https://www.financielle.comThe Vault is an entertaining yet thought provoking podcast that answers our community’s dilemmas and confessions surrounding women and money.Visit https://www.financielle.com to download our app.Watch the podcast on YouTube.Follow Financielle for more:▶︎ TikTok▶︎ InstagramAbout Financielle:Financielle is a female focussed finance app helping women to take back control of their money, ditch debt, increase savings and invest in their future.Recorded and Produced by Liverpool Podcast Studios▶︎ Web ▶︎ Instagram▶︎ LinkedIn

Welcome to The Vault Unlocked, where I take a deep dive into money topics that no one wants to talk about. And happy Monday. I hope you're all doing so well. In January, it is the longest month of all I know. And so if you're hearing this straight away, you're hearing this at a time when you're like, when the hell is payday? When the hell is February? When is it getting lighter at night? Blah, blah, blah, blah, if you're in the UK. And so I hear you and feeling that with you. And I think I definitely want to talk a little bit about how amazing I'm seeing so many of you do. Whether you're an OG financial user, whether you are a vault, religious, you know, never miss an episode kind of person.

Whether you are brand new to financial or to the concept of paying off debt and building up savings and learning about investing I have been absolutely floored by the efforts of so many of you recently when it comes to your money this shit is hard and it's got so many competing elements to it. You've got the family side, you've got the partner or no partner side, you've got cost of living kicking us in the ass. You have, you know, a 2025 that you want to aspire to be, you know, the best version of you,

whatever that means for you. And there's so many pressures to kind of manage your money on top of all that is super difficult. I think what I'm so excited to see is so many of you have realized that if you have your money shit together and if you have a money plan that you can follow, it can enable a lot of these other things. So please continue to share your stories in the app, in the financial app, in the community. Continue to send us fan mail through the podcast platforms. Continue to email the vault at financial.com. Tell us how you're doing, what you've learned, what was your light bulb moment, like all this stuff.

And make sure you send your dilemmas into the vault as well, obviously, because on Thursdays we do your dilemmas as a team. And honest to to god the stories that you tell us some we share some we don't some are super private you know this week the team won an amazing award we were listed in the startups 100 in the UK but we were also shortlisted for the marketing award alongside people like runner which I mean if you've not heard of runner I'm saying you I don't know where you've been but maybe you're just not the target market but runner are everywhere and also surreal cereal which are very very famous brand for their marketing and the fact that we were shortlisted

alongside those brands you know thank you to the team at startups 100 that recognized that the vault and this podcast is such a crucial way to cut through the noise when it comes to money. Like this podcast is meant to lift the lid on things that no one else will tell you how it works properly. Because everyone's got a vested interest in you doing certain things, spending certain money, doing things in a certain way, whatever. Like we're on your side and it's community-led and it's story-led and I think that's not by accident, like it's, we have always seen the magic in the stories because people are influenced by people, you can be negatively and positively influenced, so if we can kind of put some of you on a pedestal and show these wins and show these amazing amazing

achievements it's going to inspire the next person to do it and that's community you don't have to be in the app community you don't have to be a paying app user you don't have to be a vault listener but obviously you guys are listening to this but that community is like helping other people and being part of something bigger than yourself and I think what the biggest thing i've seen from people in the financial world is helping others and saying i was where you were and that kind of vulnerability um but that testimony a lot from someone who has already walked your path is just makes it more accessible and more achievable doesn't it i think that i think when people normalize something and they go hey they can do it why can't I so thank you to you all for helping contribute to the team um for getting that award thank you for the team for all the work that that you put in in

making financial what it is we're gonna get into today's episode today's episode. Today's Vault Unlocked is leaning into saving and specifically emergency funds but I think I really want to talk about the concept of saving. You know after the budget in the financial playbook the very first thing that we want you to do is build an emergency fund. Everyone knows they need an emergency fund. This is not new. This is not rocket science is it but so many of us don't have one and have never had one in fact just have never I've never really had savings and there's no judgment and shame here like this is just calling a spade a spade it's no surprise when we're bombarded with these advertisements to spend all the time there's always something there's always a you know I'm going to start Monday I'm going to start next month I'm going to start it when there's always a you know I'm going to start Monday I'm going to start next

month I'm going to start it when there's always something isn't there and it really is relentless it's this everyone's trying to compete for our attention and compete for our money and and we have to we have to be aware of that this episode is for the spenders the saving queens the people in the middle that jump from one to another. We're going to lift the lid on why so many of us struggle to save. Because I feel like when you see the statistics, you'll realize if you're that person that you're not alone. And then if you are a saver and you've been on a journey, you'll think about those people that were you maybe once were. But I promise you, by the end of the episode, you will have a clear, actionable plan

on how to build an emergency fund. And if you already have one, how to really refocus and level up. I want you to lean into that. I want you to be like, how can I do better? How can I save more? How can I invest more? Because the principles are the same.

We all do the same methodology every single payday. But sometimes if you're struggling with a particular step, it helps to know under the hood a little bit. This is the elephant in the room and there's a couple of stats as ever that I'm going to throw your way. Did you know that more than one third of adults in the UK had either no savings or less than a thousand pounds in a savings account last year? This equates to 22.8 million people with very little or no money to lean back on in an emergency. Much more worryingly than that, around a quarter of UK adults, which is 11.5 million people have less than 100 pounds in their savings account with one in six people having no savings at all. You know if you are

someone who has a larger emergency fund and thousands of pounds probably in sinking funds and maybe cash ices just think about that for a minute think about what that must be like that might have been you once upon a time but what will it feel like to be like that how would you make decisions on a daily basis your decisions will have changed as you've built this financial stability your ability to make well thought through methodical mindful money decisions and practical decisions will vary wildly dependent on your cash savings do Do you know what's mind blowing about saving for an emergency fund? Often it's the first time that someone saves just to have savings and not for something and I was one of these people we are constantly maybe saving for

a new car or saving for a holiday or that's your savings and then when you come to need to spend it you you spend it not many people have savings that are not meant to be touched for anything other than an emergency situation and that was mind-blowing for me and I really want you to take that away because if you are someone that struggles to save all things that you can save but actually when you reflect what you're doing is you're saving for something. Let that be the first light bulb moment of the pod. Because if there's one thing that I, I always find like there's one or two things that I'm like, that's the financial bit here.

That's what we do different. Go and think about that because I can't tell you how amazing it feels to save just to have money to not spend. And in fact, what happens later in you know our OG financial will tell you you then hate spending the emergency fund it is the worst thing that could ever happen you're trying to avoid it and you're getting stressed about it because you don't want to dip into that because you know the blood sweat and tears that went into that let's clarify though

what isn't an emergency fund. Talking about these pots of money that you might build for things like I'm saving for a holiday, I'm saving for a car, I'm saving for you know to decorate my bedroom. Whilst you do have access to that cash should something come up like an emergency it's for something else so the minute you then need to drain that money to spend on the thing you're saving for you've just gone back down to zero again and there's this there's also this like mental doubt in your mind that that's like oh that that's for the car that's for this and so it it really can mean that you lean into other ways of solving the emergency like an overdraft like credit because you are conflicted because you've given that money a job which is the thing you're saving for. And

then suddenly you need to use that money to fill an emergency. And so money that's already been saved up for something else is not an emergency fund. Also thinking that credit is what you can use in emergency is again, super dangerous and is not an emergency fund in itself. It's not a solution. This is for tons of different reasons. I mean, that credit could be pulled at any moment. If it's credit, you're unlikely to only use it for emergencies. The emergency lines, I promise you, will get blurred. Sometimes it'll be an emergency. Sometimes it'll be an emergency dress for an event. You know, we can convince ourselves of anything, as I always say so you know having credit as that emergency buffer is just again not good practically but not good for your mental

health because that's not you having your own back that's a credit company having your own back and at any moment you know job losses ill health new expense comes up rate goes up on the credit card loads of different things and suddenly you know that emergency buffer has gone. Let's now lean into the psychology of saving. I know so many of you feel amazing when you put money in your savings pot, you change your goal tracker on your financial app, you colour in your little chart that you've made, whatever it is, I know that you have turned the spending dopamine hit around and converted it to a saving dopamine hit. And that's what we want here because saving can be so, so good for how we feel. And notice, I keep talking about this, like, and I'm doing that intentionally. So much of this is about how you feel. It's not about the numbers.

The kind of number is sometimes irrelevant. I want you to feel like a superhero. I want you to feel like you can take on the world. I also want you to feel like you're achieving something because you know what? Life is hard. We're constantly feeling like we're not enough. We're constantly feeling like we're failing in so many different areas so creating these little moments where you can achieve something is really really important and that's what's amazing about the psychology of saving if you can flip this around and not have it connected to the impulse spend or the purchase on amazon and have it connected to the way that you feel when you put money into your savings, then you've absolutely

cracked it because all you need to do then is build on that. You know, spending often is a form of self-care, going out, seeing your friends, having nice experiences, taking time out, investing in your appearance, investing in things that make you feel relaxed, whatever it is. Sometimes spending is a form of self-care, but saving too is a form of self-care. And I don't want us to forget that. I want us to embrace that saving is good for our mental wellbeing, is obviously good for our physical wellbeing because it's actually saving money and building it up. But there can be some buzziness to it as well and some excitement. And I think saying that to yourself saving is a

form of self-care. Now coming back to why most people struggle to save there are a couple of reasons for this so listen out for them and are any of these you? Firstly we've got different personalities around spending and saving I think really leaning into what you think your money personality is will help you navigate why you struggle with some things you know we have the savers on one hand which is great when it comes to this exercise and saving saving up money but actually sometimes a saver really struggles to spend struggles to enjoy their money struggles to invest in themselves and invest actually in their money because they're so wanting to kind of hoard it in and build it up and pile it up and money because they're so wanting to kind of hoard it

in and build it up and pile it up and and sometimes they're too frugal as well so that's like the one side of it but some of us are just not natural savers we money comes in it goes straight out again it's kind of like this this absolute routine and that's why I think sometimes starting a plan like the playbook and starting the financial playbook and that methodology can break some bad habits and break some cycles that have just become second nature this like money comes in and then I spend it money comes in and then I spend it but I think being aware of that at least helps to helps you to understand why your saving behavior might be a particular way and also when you recognize that, forgive yourself it, give yourself a break

because we're all human at the end of the day and we have to lean into who we are as people because that's how you're gonna build a plan to overcome that or navigate who you are as a person and build that into the way that you save. Also, we cannot escape the maths in this scenario. Your income levels will determine the rate at which you can save. And so when we're talking about, let's say, the mini emergency fund,

and let's say your mini emergency fund of one month's expenses is £1,500. Let's pick that amount. If you have a high income, it is much easier to hit that goal than it is if you're on a lower income. You could be on your universal credit, you could be on maternity leave, you could have just left a relationship, you could be single and covering all the living expenses yourself. There could be lots of different dynamics at play that can impact your ability to build saving and so when it comes down to how quickly you can save that 1500 pounds your income is such a big determiner of that there's also like also something to highlight on income is when you're

on the lower end of the income scale it's harder for you to save that 1500 um but then the cost of emergencies are kind of equalized across everyone like you know the cost of fixing a car isn't cheaper if you run less money necessarily and when a washing machine breaks you don't get a washing machine cheaper than someone who is on a higher income typically emergencies cost the same amount of money so if you are saving up your emergency fund and say that you able you're able one month to put 200 pounds into that 1500 pound emergency fund one 200 pound emergency wipes that out and you've got to start again whereas someone that can kind of put 1500 away a month you know

in a 200 pound emergency only knocks them back 1300 you know they're back down to 1300 from the 200 knocked off and they go again and so being very aware of income levels and how that may or may not um hold you back and and realizing you know the higher the income the more privileged you are in how quickly this this stuff can happen so being aware of your income level is super important when navigating this how easy it is to save or how hard am I finding it to save lastly they're kind of putting it off until later mentality you know saving can sometimes feel like something that'll wait and I nodded to this earlier there's always going to be something so when we're on this mission to save an emergency fund or save for a house deposit or save for your fuck off fund whatever the fund is that you're

saving for just know today is the day you start even if you can only put a little bit in even if you can only make a tiny dent in it don don't put it off until another payday, another event, another month because you're just going to be able to put it off forever. Now is the time that you're going to do it. Before we dive into the practical elements of this podcast, I want you to really sit and think about how an emergency fund can make you feel and about what options it can give you because if you're on the fence about doing this or not, you might think I don't really need one, I want this or not, you might think, I don't really need one. I want to pay off my debt straight away. I don't want to have extra savings.

I'd rather invest it all. Wherever you are in this, just listen to what this community member had to say. Well, being in charge of my money and knowing I had money to not be afraid to spend has been the best gift I could have given myself this year, which was last year. I had a family emergency. I had to travel over 300 miles and just be there for my family.

I've helped buy food, drive people places and just get stuff that is needed and I haven't been worried once about money as I knew I had it. It's been the best feeling ever. My family kept telling me off but I said that's not what matters right now and I'm okay. They want to pay me back but I said not right now as they need to focus on other things. Thank you to this app and this community. I would never have been in this position before. Just have a little think about what that person was able to do with a pot of money behind her that is designated emergencies. I'd also like to think that this was like quite a good pot as well and so she sat there with peace of mind about her and what she's got going on and what needs she might have. She's just thinking about dropping everything and being there for her family and you may have been through those times when I don't know it might be like an ill health issue or a death in the family

it may be like a good time you know an exciting time in the family and everything kind of people need other things and you being there giving your time being able to drop everything being able to kind of do food shops here and there make sure people are driven places filling your car up with fuel paying for parking do you need help with that I can do it you can do that when you have some emergency funds behind you because you're not sat there worried about well if I'm spending this here then what's going on back there that I cannot tell you how you would have also made your family feel. This wasn't some huge grand numerical gesture. This wasn't you writing a check and sending it. This was you being able to give yourself freely without any consequence,

without any terms, without any payback. Just like, yeah, I'm here to help. And honestly, I think you might have got something more, as you said, out of that than your family did. But they will not forget that either. That's the kind of thing that having a chunk of money behind you can do. You really have to think about how this feels. This isn't about, oh God, I mean, my husband's all about round numbers.

God forbid our emergency fund has an extra pound and 50 pence in it. Which, by the way, if it's growing in interest, is what he like he really struggles with he likes nice round numbers and so he's constantly like I need to move that out of there I'm like that's the high interest account but it's not just about the number even if like my husband the number being nice and round makes you feel good but it's about the power that having that gives you I want you to get to a point where you actually don't know how much you've got an emergency savings at any one time you have to check in with your net worth once a month and you do the calculation in the app and you're like oh look how we're doing like we're doing okay we've

got all that cash behind us you know because um Carl and I did that um did our net worth like a few days ago actually we put it in the app looking at the cash that you have and we always make this decision because when we're looking at our excess and we're deciding where to put it we have a conversation around honestly I'm not joking how our emergency fund makes us feel and so I will we will do the net worth and obviously when the interest is going up the balance of the cash is going up and I'll say how's that feel does it feel okay and he's like looking at the numbers and going yeah no and we sit there and think and we think about you know our stability and we'll think about what we've got coming up and we'll think about our expenses and we'll think

about our goals and we'll go yeah no that feels all right but at any one moment as a couple we can sit there and go we'd like it to be higher or it's a bit high that let's kind of siphon some stuff off and let's put it into investments or let's put it to something else because we're okay we don't talk about the number even though i know in his head he's like but can it be a nice round number please we're thinking about how it feels that's what you're going to take away from this so whether this is your mini emergency fund of one month's expenses or a minimum of that or whether it's higher because you know you've got health issues or you might be planning for a baby or where or you might be planning to leave a job or you might

be planning to leave a relationship whatever your thing is think about how that amount feels because honestly once you hit that goal and you've saved it and it's in your back pocket it'll be the best thing you ever do and what's very freeing about it or like not freeing that's the wrong word but what's very comforting about an emergency fund is that it's always going to be there when you start this plan when you commit to building an emergency fund and then paying off your debt and then buying a home if you want to buy a home and then investing over and above like minimums when you commit to that that's forever you will always have an emergency fund just like you will never use consumer credit and I can't tell you how

comforting it is and I've never really thought about this before but if you think of the emergency fund as physical cash let's imagine it's cash that cash has been with my husband and I for 10 years more maybe because once you put that 1500 3000,500, £3,000 whatever amount is for you that money away in that emergency fund you might use it and you'll build it back up you'll use it and build it back up and then when you build the bigger one of like three to six months expenses plus I like to mentally think that the first £1,000 that we put in years and years and years ago is still there it's like our old friend and it's never going away. I bet you've never thought about money like that before. Okay, we're cracking on. We are going to think about how this feels and that's going to drive

everything. Some of you know this from past episodes and the budgeting episode will help with some of this. Also the playbook episode will help with some of this. But how do we do the mini emergency fund? We start by picking our amount, number one, you're going to pick your amount of money. So is it going to be one month's expenses? Is it going to be a nice round figure like a thousand pounds or two thousand or three thousand, whatever it is in dollars and euros or for anyone else following? What is it for you? Thinking about your risks in your life, life your fixed expenses what you need in that emergency and pick that amount and it was with a partner agree on it with a partner and if you're

trying to pay down debt and trying to build up emergency savings at the same time i would say my guidance is to stop doing that do one at a time because you just we've talked about it on the episode but there's a million reasons why really you need to pause overpaying your debt. Just pay the minimums and lean into building your mini emergency fund.

Do one thing at a time. So pick your amount and stop doing debt overpayments so that you can lean into this mini emergency fund goal. And then you're going to use your excess to make it happen. So remember when we do a budget

in the financial app or on piece of paper, but using the financial method, you're going to put your excess to make it happen. So remember when we do a budget in the financial app or on piece of paper, but using the financial method, you're going to put your income at the top, all income sources. You're then going to take off fixed expenses, sinking funds amounts. So the amounts that you move over to your sinking fund pots every month and flexible expenses, and you're left with your excess. And again, gentle prompt, I want you to look at the excess and go, hmm, is that big enough? Because that's the amount that's going to be going to your emergency fund every month. You won't have dealt with it anywhere else. The emergency fund payment goes on the bottom.

So if that excess is pretty shit, go back and have a look. Is it challenge yourself? Can I make any more money? Can I sell anything? Can I take something back I don't want? Can I cut my eating out expenses? Can I consolidate my subscriptions to don't want? Can I cut my eating out expenses? Can I consolidate my subscriptions to be these two, three things that I actually use? Whatever it is, do that. It squeezes your budget. It creates a bigger excess. And the excess is what goes towards saving your emergency fund. Now we're going to estimate how long it's going to take us to hit our emergency fund goal. So this is where the financial app is really helpful. The goal on the front page, you can kind of create a goal and you can say, I want to save 1500 pounds and my excess at the moment is 300 a month. You've been able to squeeze the budget

and you found 300. That tells me that it's going to take you five months to hit that goal, especially five months if you don't have to dip into your emergency fund, which you might have to, don't worry, you will have to at some point, but it's going to take you five months. Next, you're going to challenge yourself to see if you can do it quicker. Can you do it in three months? Instead, can you pull together 500 a month? What else do you have in your life that you can do to build up savings? Because all you're doing is doing this. All you're doing is building up the savings in the pot, that 1500 so challenge yourself to think where else can i find some money where else can i make some extra money as i just said like what can you do to squeeze that budget and create the extra excess to hit your goal faster and lastly like anything try to stay

consistent and like resist temptation there's it's going to be coming like this is an exercise in itself this is like going to the gym you need to build up this muscle this saving muscle and you have to build up this resistance muscle which is resisting temptation what can you do to avoid overspending we've said this um on other episodes before look at where the spending habits were do you need to come off amazon because if you need something in an emergency, you can go to the shop and buy it. Do you need to disconnect Apple Pay? Do you need to, I don't know, let's think more practically, like if you are a, I mean, do a low spend month, that could be something, especially if you're an impulse spender. But if your money's been going on takeaways, challenge yourself to a month without takeaways stuff that will derail you try

and put plans in place to help alleviate that or see it off at the pass it really is a personal thing this is not a one-size-fits-all you're going to have to look back at where your money's going and look at your weak areas and see if you can come up with something practical to make to shut that down before it happens. Thinking about your emergency fund as this untouchable amount of money is honestly game changing for your mental toughness and kind of how protective you are of it. But ultimately, the Vault listeners, I believe that you can do it. If you've been someone who has always struggled to save, this is the year that you're going to be able to do it. Okay, lastly, we're going to come on to this week's homework. So homework is mainly for people that do have

something to save for. This could be your mini emergency fund, it could be a house deposit, it could be maybe a particular sinking fund that's a goal of yours right now, it could be the bigger emergency fund, whatever it is, if you are saving for something right now, or if you should be saving for something right now, you have homework. Firstly for something right now you have homework. Firstly you're going to set your number you're going to work out what your mini emergency fund is if that's what you're working towards or work out your number if you're working to a different goal and if you look at your expenses that you would need to navigate at least one month pick that number make it round and pretty if you want to and then set that. Get it in the app because you can work out how long it's going to take you to hit it based on your access as well. Once you know your number and you know your access so you know

how long it's going to take you to hit your savings goal, I want you to stretch yourself, really challenge yourself, think of ideas and two or three things that you can do to speed up you hitting that goal and to bring that milestone closer. And then lastly, make sure you go get accountability in the community. Go there, tell people, hi guys, I'm you or I'm a lurker or I've been here all the time but I've decided to set myself an emergency fund goal. This is how much it is. This is how long it's going to take me. I'm going to check in once a month every time I do my budget and move my money for the next few months. I'm going to tell you when I hit my goal and can you all celebrate with me when I do. And that's when we will do the best. So please do do that last point because that accountability really, really

helps. Don't forget your own circle as well. So is there a partner that you can share this goal with? Do you have a group of friends and tell them, you know, definitely sharing it with friends and family is a super helpful way of getting them on board with your goal, but also for holding you accountable too. And you know what? If you've made it this far and you already have an emergency fund and you're just here to listen and to reminisce about what you went through when you built your emergency fund. And I want you to do a bit of an audit on your emergency funds. Where are they? Are they in the best interest bearing accounts we have got lots of different um examples of good interest rates in the fan in the financial money deals blog in the app so have a look there ask in the community if you need a link to it but if you go to the blogs and you search money deals in fact i saved that i've got it on my saved blogs and have a look because that's been

updated once a month and you'll be able to see some really good interest rates but make sure your money's working for you it should should not be parked in rubbish interest-bearing accounts. It should be growing while you sleep. Before I lock the vault, obviously we would love you to send an email to thevaultatfinancial.com to talk about the topics that you would like to hear next or to share your perspective.

We love hearing from you. We'll read some out as and when we get them in, but please make sure you stay in contact. As I said earlier, we want you to keep sharing your stories because it's the stories that drive other people. And just a disclaimer, The Vault Unlocked is just a lighthearted chat about money topics. It is not financial advice.

Bye-bye.