Savvy saving tips using Parkinson's Law

When it comes to packing for a trip, my partner and I have a running joke. My trusty overnight bag somehow manages to fit everything I need for a two-week holiday. Meanwhile, my partner's larger suitcase always seems to be bursting at the seams, no matter the length of our getaway. It's a vivid example of Parkinson's Law in action.

Cyril Northcote Parkinson was a naval historian and author who penned a satirical article in The Economist magazine in 1955. The article was about bureaucratic inefficiencies, but the key take away which stuck in the minds of his readers and has become his well known principal called Parkinson's Law, was his observation that "work expands to fill the time available for its completion". We've all experienced it – a meeting scheduled for an hour inevitably takes the full hour, and a report somehow is only ever finished just before the deadline.

This principle isn't limited to time management, it applies to other aspects of life too, like my partner's suitcase. And it also applies to finances, especially for First-Time Buyers striving to save for a deposit. How many times have you intended to put aside money that's left at the end of the month, only to find its all been spent? Trying to save up a deposit like that will take years.

So here are some simple steps that you can implement to outsmart Parkinson's Law and accelerate your deposit savings:

1. Stealth Savings: Create a separate account that's not easily accessible. By 'hiding' money from yourself, you're less likely to dip into it for day-to-day expenses. It's like finding a forgotten tenner in your jacket pocket, the one you haven't worn since last winter. You didn't miss the money when you forgot it was there, and its a nice bonus when you found it.

2. Prioritise Savings from the Outset: As soon as your wages hit your account, allocate a portion to your savings. Since you never saw it in your spending balance, you won't miss it. And if you can automate this step by setting u a standing order, even the better, because you won't forget to make the transfer. This makes saving a seamless part of your financial routine, which you don't have to think about once its in place.

3. Maximise Your Pay Rise: If you receive a salary increase, consider putting at least half of it into your savings. While it's great to enjoy some of the extra income, this approach helps minimise lifestyle creep and turbo boosts your rate of saving. You've probably managed just fine on the lower wages before the pay rise, so the closer you can keeping your spending at the same level before the extra wages, the more you can put into your deposit savings.

Where you park your savings matters too. Opt for an account that's not easily visible or accessible. The "out of sight, out of mind" approach ensures your savings remain untouched, steadily building towards your deposit goal. These small actions above will make a huge impact on how quickly you hit your deposit saving goal.

And these behaviours aren't just about buying your first home; they are financial habits that can serve you well throughout life too, ensuring you always live within your means. Our goal is to empower you, step by step, while you build up your deposit. To conquer that goal like a true Deposit Defeater.

We are here to empower you one financial principal at a time