Thursday, 21 August 2014

Turning £20 into hundreds - week 1 The Stocking Up fund

With my birthday looming at the end of this week it is as always a chance to reflect on the last year. With far too many birthdays under my belt to still be on the losing side when it comes to finances I have been encouraged to start looking again at an idea that fell by the wayside about 2 years ago as it was too much of a faf at the time. The stocking up fund.

Called "The stocking up fund" in our house it was an idea I originally came across on moneysavingexpert.com as the third purse system by a poster called mothership.  The idea is that you have your normal grocery budget (first purse), this buys your normal weekly/monthly stuff for your family.  You then have a fund available for buying "extras", this can be stuff you buy on special offer or as a bigger than usual pack; this is your second purse.  As you buy stuff from your second purse you build up your own stockpile.  As you use stuff from the stockpile you pay your second purse back the price you would pay normally in the supermarket out of your first purse.  Net result is that your first purse (your budget) is not any different to how it would be if you hadn't stocked up in the first place; but the stocking up fund gets replenished to allow you to get more "stock" when you see it on special offer.  So where does the "third purse" come in? The amount of money in the second purse should increase week by week and if you set yourself a limit to how much money that purse should hold then when you go over that threshold that money goes into a third purse; this money is for you to spend on a treat, or in my case stuff for the kids.

So much for the theory now for the practise...

This week (mon 18th to sun 24th august) I started with a stocking up fund of £20.  This was in the form of money off vouchers for my local supermarket and normally I would put these aside until Christmas to buy extra food for the holiday, so over the course of about 4 months that £20 would have made me £20!  I think this system (if I can stick to it!) will net me much more than £20 by Christmas.  Having scanned the websites of the big supermarkets for offers on stuff I would normally buy anyway I discovered that Tescos is offering 78 Finish dishwasher tablets for £10 - half the normal price.  So I blew the whole of the fund and bought 2 boxes.  Normally if I couldn't get dishwasher tabs on offer (and I needed them) I would have to buy the smallest pack possible and this works out at 42p/tablet.  I use the dishwasher once or (when OH is actually here) twice a day, so I am going to assume that I use 14 tablets a week, that's £5.88 on dishwasher tablets if I was going to pay the most expensive price.  By transferring this amount from my grocery budget each week my grocery budget would not be changed at all (apart from the fact is smooths out the peaks and troughs because of course I do not need to buy a whole pack each week), but it will begin to replenish the stocking up fund.  So here's the summary for this week

Stocking up fund £5.88
Stock - 71 days worth of dishwasher tabs (£59.64 worth!)

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