Usual Saving Strategy Backfired

Not sure where I read it or who said it, but I currently follow the saving strategy of:

Spend what you don’t save, rather than save what you don’t spend“.

So every month, as soon as I get paid, money is automatically taken out of my bank account for my savings and investments and I then live on the rest. This seems to have been working quite well for me.
However, the plan backfired on me this month…
Aware that I was going to be spending a lot on presents for family and friends this month, my intention was to reduce the automatic amount taken out for savings/investments.

However, I forgot to make the adjustment, so the full whack went out of my account and I’ve ended up nearly £400 overdrawn! Fortunately, I spotted it in time before the balance went over my overdraft limit, which would have resulted in horrible bank charges.
I have used some emergency funds to plug this gap but will need to make sure I top the funds back up (for real emergencies…).


I appear to have spent a lot on presents, more so than last year, probably because I will actually be seeing my family this Christmas. I seem to have also spent more per friend and I’m not sure how that’s happened – poor planning I guess.

So do I need to change my saving strategy?

This is the first time this has happened, so I’m likely to stick with it for now –  what I should have done was amend the automatic amount as soon as I realised what was going to happen, instead of procrastinating and then forgetting about it!
That’ll teach me…

18 thoughts on “Usual Saving Strategy Backfired

  1. Whoops!

    All our spending goes on a cash back credit card which gets paid off a few days after payday. This way I always have a week or so to pull in some more cash from savings to pay the bill IF required. The fact that I have to manually pay off the credit card means I am keeping an eye on the spending regularly so it encourages me to not spend too much!

  2. Hi weenie, I feel for you.

    Since starting to manage our money more actively I have been relying on my memory to remind me to pay £500 a month into our Santander account, pay £250 a month into my M&S regular saver, pay my M&S credit card manually and make sure that I adjust our regular payments into Interactive Investor according to the amount of "left over" cash we have that month.

    So far I've managed to keep all the balls in the air but I'm sure it's only a matter of time. 🙂 Perhaps my new Years' Resolution should be to set up more SOs?

    I'm glad that there was no real damage done to your current account by the small lapse in concentration. (It sounds like your present buying made a definite dint though -:)

  3. It could have been worse. 🙂

    Like Guy said, at least you didn't get hit by bank charges. I know your situation wasn't ideal, but it's a nice reminder of how you can avoid a similar situation in the future.

    Is my pressy in the post?

  4. Nice catch on avoiding the fee. Maybe a good way to avoid this in the future is to allocate a "present" fund and allocate some money throughout the year?

  5. Hi Guy, yes. In the past, when I wasn't saving so much, I could get away with not always checking my current account – can't do that any more with payments going out for savings as well as for bills!

  6. Hi UTMT, I've been splitting my spending between both credit and debit card – as I've struggled with credit card debt before, I'm still quite wary of putting too much on there apart from my groceries and petrol – everything else is on my debit card. My credit card gives me airmiles which I always save for long haul flights!

  7. Hi Tawcan, yes – had I not checked in time, I would have taken money out of the cashpoint for my night out on Sunday and gone over my limit – I recall the dark days of paying such bank fees.. 🙁

    Good idea about the 'present' fund, since I shouldn't be using my emergency fund for such purposes! Thanks for the suggestion!

  8. Hi Huw, yep, it so could have been worse and I was so relieved I didn't get the bank charges. Need to make sure I keep on top of things, especially in times of high spending.

    The set of weights I bought for you are too heavy to post unfortunately… 😉

  9. Hi Cerridwen, tell me about it! Whilst I love being active in looking after my finances, it only takes one little mistake or a bit of forgetfulness or distraction and things can go rather wrong! If I were in your shoes however, I would probably set the payment to Santander and M&S payments up as standing orders – two less things to think about, especially as you too have to adjust your regular payments to you II account. I just need to make sure to do things straight away as I remember them!

    Just been wrapping some of my presents and I seem to have surplus ….I need to make sure I put these away safely for next Christmas (or for birthdays!) – I knew I messed up on my planning!

  10. I would rather say "oups" than "ouch".
    Mistakes happen and you learn from them.

    Also, this prove you're financially responsible thanks to your emergency fund.
    Most people out there would have cried all Christmas long…but you can claim to be free of any worries nor panic mode!
    Everything is under control and you will build up back quickly your cash cushion without noticing it!

    Regarding your overbudget, as long as it was to make family and friends happy, I think it's a good thing. Moreover because you can definitely afford it.

  11. Hey,

    It will happen from time to time, even with the best planning! You have liquid funds that you can use to cover yourself, good work on avoiding the charges and not being over drawn too long 🙂

  12. Never mind, these things happen – at least it didn't cost you any money 🙂

    We have a gift fund (save into it monthly), but I still buy gifts on a cc and then pay it off immediately from the gift fund balance to avoid any mistakes.

  13. Hi MP, yes, lesson learnt and I am glad for the emergency fund, although I would rather not dip into it.

    Thanks for your kind words and for stopping by!

  14. Hi Mr Z, yes grateful for the liquid funds, that's what I never had when I was in debt and I don't want to be there again. Need to work on not doing this again though!

  15. Hi Laura, great idea on the gift fund as suggested by someone else too – I will definitely set something up, if only to swallow a chunk of the costs next time round!

  16. Hi Weenie

    Its a good strategy to use on savings and usually I did it as well with an exception to Dec because of the festive season.

    The key here is in managing the cashflow and budgeting them right to the point so that we dont go overdraft. I too still trying to learn the art of saving best.

  17. Hi B, yes, I made the mistake as it's my first proper year of saving, I know for next time that I can't treat December like a normal month! It's good to be learning all the time! Thanks for stopping by!

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