her space holiday: saving for the fun stuff on a budget;

Make the most of your ISA allowance

Chance would be a fine thing…

The run-up to the new tax year at the beginning of April is one of my favourite times of year, simply because I find the gentle reminders from my bank to make the most of my tax-free ISA allowance before it resets like Cinderella’s hairstyle at the stroke of midnight so amusing. It was funny enough when the tax-free limit was £5,000, but the idea of ever having £15,000 worth of disposable income in a year is too much for me to deal with.

That said, I have been making an effort to save this year (responsible homeowner now, remember?) and my ISA is a great way of doing it. I get to earn interest on my savings without getting taxed on that interest, and since mine is a flexible product I can withdraw the money whenever I want. From this finanical year, anything you withdraw won’t count towards your tax-free limit like it does at the moment – useful if you spend your entire £15,000 on a shiny new car and then find a wad of banknotes down the back of the sofa, I suspect (sidenote: an ISA is not the only way to invest, and Legal & General have some useful resources summing up the pros and cons of different investment methods).

Newlyweds in Apple 5th Avenue, July 2010

Newlyweds in Apple 5th Avenue, July 2010

My savings goal this year is far more modest, albeit a big deal for me: inspired by my blogging buddy Queen Jane Approximately – who has sadly disappeared from social media of late and so is missing out on a tip of the hat – I’ve been taking part in a 52-week savings challenge which, if I manage to complete it, will leave me with close to £1,400 by the end of the year which I will hopefully be able to put towards a much-needed holiday with Stringer. Since we haven’t been away together since our New York honeymoon – five years ago this summer (!) – and since, if we make it through April without killing each other, we’ll have survived two of the most stressful things you can do as a couple, we’re hoping to celebrate with another trip to our favourite city ahead of this year’s Bouchercon in Raleigh, NC. Bouchercon is the World Mystery Convention for writers of the genre so his attendance is essential – and since I have a couple of good friends in the state (one of whom has just become father to a gorgeous baby girl, and the other of whom has just got KITTENS) I’m thinking a rambling cross-country train ride might be in order…

It Still Moves
So the 52-week saving challenge seems to have been around for a while, but when I heard about it I thought it was ingenious. Essentially, you put by a weekly sum of money corresponding with which week of the year it is: so, £1 on 1st January; £2 on 8th January; £3 on 15th January; etc. If you stick it out until the end you’ll end up with £1,378 in savings – plus, an extra little pot of interest if you save it into your ISA as I have been doing. It’s Week 14 on Thursday and I haven’t missed a week yet – although I appreciate that, as the amounts progress ever more into double figures, the challenge will get a little steeper each week.

But it’ll be worth it when I’m gazing out of that Amtrak window, a notebook on my lap and some Great American Roadtrip playlist in my ears – right?

How do you put money by for the fun things in life when you’re on a tight budget?

Thanks to Joe Blogs and Legal & General. I received vouchers in return for this post.

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