How To Be Good With Money- Millennial Money Management


Millennials. The generation that is hounded for having no money left at the end of the month, no idea about how to be good with money, and an ever increasing appetite for avocados. 

But as you and I know- this is a pretty lazy typecast. One generation does not share the same financial values, and many kids of the 90s now have savings accounts and are trying to make their way in the world. I should know, I’m one of them! 

It’s taken many years for me to learn how to be better with money. Some people might even go as far to say that I am now ‘good with money.’ But that all comes with time, patience, and a lot of trial and error. 

This post is everything I’ve learnt about how to good with money. The things that really count for something when you are trying to make a change to your financial habits. 

The first things we are going to discuss are the things that you can implement which will make a BIG difference to your life. These points are probably the 4 pillars of better money management… 

1. How to be good with money? Set a budget

First thing’s first. You need a budget. Many people say ‘I don’t need a budget, I know how much I spend each week.’ If you’re one of those people and you want to learn how to be good with money, create a budget and see how much it reveals about your spending habits.

I thought I knew how much I was spending, and what I was spending my money on. Until I sat down and wrote down every expense that I had incurred for a whole month. I spent WAY more on food than I could have ever imagined. 

When you want to set a budget, start by writing down all of your fixed incomings (your salary) and outgoings. That’s things like rent, bills and monthly memberships. 

Then, start tracking all of your expenses- food, travel, leisure, meals out- all of it. This should give you a clear picture of what you are spending in relation to your income. 


From there, you can decide what style of budgeting will suit you. You might consider using the 50 30 20 rule, or perhaps a zero based budget. Read both of these guides to find out which one might be the most suitable for you. 

Sticking to a budget is the best way to manage your money, because you are actively engaging with the numbers. There is no hiding from what you earn and what you spend- it’s there in black and white. It’s up to you to make the change. 

A budget by no means has to be something that makes you feel deprived or being left wanting more- it’s about spending less on the things that don’t matter to you, and spending more on the things that do. 

Love travelling but not that fussed about going out to eat? Tighten up your budget for meals out and allocate more money to your travel fund instead. 

Ideally once you have your budget up and running, you’ll want to start putting some money into a savings account which brings us onto the next point… 

You might also be interested in: How To Say No To Yourself- Self Discipline and Budgeting

2. Pay yourself first

Paying yourself first is one of my favourite money mantras. The idea behind this phrase is that when you get paid your monthly wages, you immediately put a percentage into a separate savings account (ideally set up a standing order to do this so that you don’t forget).

This means that the money that you have earned and want to save goes directly into a separate space, and you can forget about it. It helps to remove the temptation to spend your savings when money gets tight at the end of the month.


3. Save an Emergency Fund

An Emergency Fund is something that everyone should have in their financial arsenal. Ideally this is the first thing you need to save up before you start saving towards a concrete goal or before you start to aggressively pay off debt.

An Emergency Fund is ideally 3-6 months’ (or 1 month if you are paying off debt) worth of expenses that is easily accessible in the event of an emergency. I have dedicated a whole post to this topic: What is an Emergency Fund and how can I save one?

As the name suggests, the money in your emergency fund should only be used in an emergency- when you have an unexpected expense that can’t be covered by the money in your regular current account.

This means that even if you are working towards a big financial goal, like becoming debt free or becoming a homeowner, you won’t have to take a step backwards if the worst happens. 

4. Save up sinking funds

Not to be confused with Emergency Funds, Sinking Funds are pots of money that you save over time with a large expense in mind. 

You would use sinking funds so that you don’t have to adjust your budget each month for big expenses- and it also means that by saving up for an expense slowly, it isn’t as much of a hit on your finances. 

You might decide to have several sinking funds, perhaps for Christmas, birthdays, and an upcoming holiday, for example. 

A brilliant time to start a sinking fund is around 6 months to a year in advance. So for example, if you decided to start a Sinking Fund in January for the following December, you might decide you want to spend £300 on Christmas, and so you would divide this figure up and put £27 in a sinking fund each month from January-November so that you have enough money to cover your Christmas expenses.

So, now that we have covered those four very important money management strategies, we can move onto earning more money

As you can probably already guess, there’s no use making more money if you don’t know how to manage it. Someone who earns £100 per hour can be as broke as someone who earns £10 per hour if they don’t manage their money well.

It’s a good idea to have the basics in place before starting to seek out more cash in your bank account each month. This helps avoid unwanted ‘lifestyle inflation.’ Whereby as your income increases, so do your expenses- unless of course, that’s exactly what you want to do with the extra money, in which case, go on ahead! 


5. Get Paid Your Worth 

The best way to earn more money, is to get paid more for the work that you already do. If you’ve not had a pay rise in a while, and you’ve been going above and beyond at work- it might be time to have that all important meeting with your manager. 

You can check out my in depth post about How To Ask For A Payrise- And Get One! To get all of my tips on how to get paid more for your time at work. 

And if you freelance? Regularly review your rates (and increase them!) as your experience and expertise grows- you’re your own boss so make sure that you’re kind to yourself and regularly give yourself a raise. 

6. Take the FREE Thrifty Londoner 7-Day Money Making Course 

So this is a little shameless plug of my FREE email course which takes you through short term and long term ideas for making extra money. If you’ve budgeted like crazy but you’re still not making the progress that you’d like to be making, you could consider picking up a side hustle. 

It has a ton of ideas (all of which I’ve personally tried and tested) of how you can make extra money on the side. I talk about my experiences with freelance writing, blogging and selling- and the money that you can expect to make. 

You also get access to the exclusive Thrifty Londoner Financial Freedom Facebook Group, where you can chat to like minded people about your money making journey- and I am also on hand in the group to help you reach your money goals. 

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Like I mentioned earlier, you absolutely do not have to give up the things you love when you start budgeting. That’s a myth! Budgeting can actually give you the space you need to spend MORE on the things you love, and less on the things you don’t. 

So with that in mind, these are some lifestyle tweaks that you could put into practice to start saving money on the everyday. As the saying goes- when you look after the pennies, the pounds will look after themselves! 


7. Meal planning and batch cooking

Food is where most people will spend a large portion of their money. It’s an unavoidable cost, an absolute necessity, but most people could cut down their spending in this area. 

By using up as much of our food as possible, we avoid wasted produce, and also avoid wasted money. My trick to using up as much food as possible is by meal planning and batch cooking.

Meal planning does have to be a chore- it’s entirely possible to have a flexible plan with a couple of options available, just in case you just don’t feel like eating what you had originally planned for that night. You don’t have to stick to the same meal plan week after week (although if that works for you, go for it!) it is possible to have variety and change your meal plan regularly. 

Meal planning saves money because you are more likely to stick to a shopping list, use up all of your ingredients, and be less likely to pop into convenience stores (I’m still trying to break that habit!). 

You might be interested in: cheap easy vegan meal ideas, all under £1 per portion!

I also swear by batch cooking, which not only saves a lot of time after work, but also means that fresh ingredients are used up all at once, and frozen for a later date. This is particularly ideal if you are only cooking for yourself, or yourself and a partner. 

8. Unsubscribe from retail mailing lists 

How many times has an email dropped into your inbox with “20% off for today only!!” and you’ve found yourself rushing to the website to buy something at a discount? 

I’ve been there more times than I care to mention. BUT you can avoid that temptation to spend by unsubscribing from these mailing lists- out of sight, out of mind. 

And if you love clothing? Have a shopping allocation in your budget for such eventualities! 

9. Plan ahead

Convenience costs money. For many things, if you don’t plan ahead, you’ll end up spending more money. It can be as simple as not walking to the station in time and having to get a taxi to get to your dentist appointment. 

Or forgetting about a birthday and having to grab the first thing you see- which happens to be way over budget and not the perfect present, but you have no time to look elsewhere so you have to buy it. 

Planning ahead can be a great tool in better money management- by budgeting in advance, anticipating large expenses and getting your ducks in a row, you’ll find yourself feeling much more financially healthy. 

10. Utilise money saving apps

In the 21st century, we no longer have to use a pencil and paper to track our expenses and our budget plans.

The arrival of fintech and challenger banks means that we have a crazy amount of tools at our disposal to be better with our money.

Check out my guide to the best money saving apps to see which ones I most rate and why- spoiler- I love Monzo!


11. Use cashback websites 

For me, using cashback websites was a real game changer. When I started to regularly use Top CashBack to get money back on my purchases, I was left with a tidy sum of money to withdraw by the end of that year. 

It’s essentially free money on things that you were planning on buying anyway. 

It’s not going to magically change your money habits, but making the change now will certainly leave you feeling amazing when you have a couple of hundred pounds to withdraw by the end of the year. 

And when you’ve got the basics down, you’re budgeting, saving and living your best life.. It’s time to prepare for the future. 

12. Make Pension Contributions 

Pensions. Even the word itself seems dull. But getting your head around making pension contributions is one of the best things you can do to look after your future self. 

The earlier that you start contributing to a pension the better, because due to something called ‘compound interest,’ you will earn interest on your contributions, and then will earn interest on top of that interest and so on. Time is on your side. 

If you’re unsure of how much you should be contributing to a pension, I have written a guide- How Much Should You Contribute To Your Pension In Your 20s? Which might help you work out how much you’d like to contribute to your pension for the future, and how much you can afford to at this time. 

how to be good with money with an emergency fund13. Get insurance 

Getting insurance seems like one of the most ‘grown up’ things you could do, and that’s because it’s one of the most sensible protective measures you can take for yourself and your family. 

My Dad used to always tell me to get contents insurance- I never listened until last year I witnessed a flat in the next building over go up in smoke! A fire could happen to anyone, and if the worst happened, contents insurance can give you peace of mind that you would be able to recoup the costs of your possessions. 

I have also recently signed up to a Life Insurance policy- and yes, I’m only 27! Life Insurance isn’t just for the over 50s. I spend money on this because if I became seriously ill, I want to make sure I don’t have to worry about money. I do not have a sickness benefit scheme at work, and so if I was ill for over 1 week, I would go on statutory sick pay (which isn’t even enough to cover my rent!) 

Life Insurance is a valuable asset to have to protect your future self. 

14. Start investing (if you want to!) 

Investing is certainly not for everyone, but if you have a certain amount of money that you are comfortable enough to put aside to invest in the stock market, then it could serve ‘future you’ very well. 

I wrote up my experience in How to Start Investing- What I Learnt After 6 Months of Investing in the Stock Market which might give you an idea of what I did when I started investing, how I knew I was ready, and what worked for me. 

If you’re not comfortable with the idea of investing in the stock market (and even if you are!) one thing that will always serve you is investing in yourself. If there’s a skill that you want to master, or a qualification that you would like to have, your future is one of the best things that you can invest money in. 

So there you have it, 14 ideas on how to be good with money. 14 things that you can put into practice to cover the basics, earn more money, and protect yourself in the future. 

Managing your money doesn’t have to be stressful, nerve-wracking or complicated. Work out which methods work for you and which don’t. Find out what spending is important to you, and what you can cut back on. 

Find a goal that is so important to you, that you want to make positive financial changes- that is how to be good with money. 

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