In our How I Manage My Money series we aim to find out how people in the UK are spending, saving and investing money to meet their costs and achieve their goals.
This week we speak to Peter Duddy, 25, who lives in London with his girlfriend, Maddie, 25. Peter, who works in the NHS, is stashing away cash in a Lifetime Isa (LISA) in a bid to buy a home. He plans to continue using his LISA towards his future pension pot after buying a property. At work, he’s able to add over 9 per cent of his salary to his pension each month at present and would like to retire by the time he is 60. He’d love a salary of £100,000 a year.
Monthly budget
Income: I earn about £1,800 a month from my job as an NHS apprentice data analyst, after tax and pension deductions.
My main monthly outgoings: Rent, £600; groceries, £200, gas and electric, £110; water, £20; council tax, £60, public transport, £45; money into savings and investments, around £200 a month. I don’t have a car, so I save money on fuel and insurance costs. I usually add £4,000 to my LISA a year.
I grew up in St Albans, Hertfordshire and would consider our family to be well off. My parents, one an electrical engineer and the other a dentist, have always been very forthcoming when it came to giving me financial advice and tried to teach me about being smart with money, even when I didn’t always want to listen. They taught me about savings, interest rates and the basics of investing.
After graduating from Oxford Brookes University I worked in a few different pubs and then got a temporary job as a lab technician at a pharmaceutical manufacturer in Hitchin. I currently work as an apprentice data analyst in the NHS, earning around £1,800 a month after tax and pension contributions.
I want to buy a home but I’m not sure when or where I’d like to purchase one. I imagine my work and career path will influence any decisions I make in this regard. I’m not particularly worried about higher mortgage rates. By the time I’ll be looking to buy a home, perhaps in five years or so, mortgage rates may well have fallen.
I opened a stocks and shares LISA with Moneybox in April 2020. Someone in my family told me you could save up to £4,000 a year in one and get a 25 per cent bonus on all contributions. The earlier I started the LISA the more free money I could get from the government. The person who recommended the LISA to me has always been very knowledgeable about financial products and I trusted their recommendation for a provider.
So far I’ve been able to add £4,000 to my LISA each year it has been open and I have £15,000 saved up in it in total, which I plan to use as a deposit towards my first home. Even without the government bonus, I’m seeing great returns.
I will definitely continue saving money for retirement using a LISA after buying my first home. The 25 per cent government bonus is still free money, so it wouldn’t make sense to stop using it.
I currently opt into the NHS pension scheme and I contribute 9.3 per cent of my salary to it each month. I’m unsure how much the NHS contribute to my pension. I don’t know how much is in my pension pot at present, but if I can increase contributions and lay the foundations of a solid investment portfolio, I would like to retire by the time I am 60.
Aside from a standard savings and current account, I put £40 each into two separate exchange traded funds I have with Chip. One is a fund that specifically invests in clean energy, while the other invests in tech companies listed on the S&P500. I also put £120 a month into an easy access savings account offered by Chip.
I’d say I’m more of a saver than a spender. I don’t spend a lot of money very frequently and I’m always trying to reach my next pay day with at least £100 leftover. When I do spend, I like to wait a while and buy something big like a new TV or a guitar. I also save money each month by not going out too much. I will go on a night out maybe once a month around payday and try not to spend too much money on London pints. I also shop at Lidl, which is noticeably cheaper than its rivals. I try not to have the heating on too much at home, cook big meals so there are leftovers and don’t buy new clothes too often.
While money is not hugely important to me, the things it can provide are very important, particularly when it comes to giving peace of mind. An ideal salary for me would be £100,000 a year, as I’d be able to comfortably provide anything my family would ever need. That’s the ultimate goal.
In the short-term I’d like to get a job that provides a bigger salary, and looking further ahead my long-term financial goal is to have streams of income other than the salary from my job. This could be from investments or from being in a position to do additional freelance work.
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