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How to save £100k (start these steps now)

Understandably, you might want to save £100,000.

After all, who wouldn’t want to have a cushion of savings for a rainy day like that?

Saving 100k is going to take a plan involving spending less, saving more, earning more and staying out of debt. The better you get at this process, including investing your extra money for more growth, is how you will get to 100k savings in as short an amount of time as possible.  

This article will outline some of the best ways how to save £100k and overcome the common challenges you can face when trying to reach this goal.

 So, keep reading for helpful tips and advice that will make saving £100k a lot easier.

How to save £100k

Know your numbers to reach £100k

It’s important to know your numbers when it comes to saving £100,000.

If you don’t know how much is coming in or going out, it’s going to be very difficult to make any meaningful progress towards £100k.

  1. What is your net worth right now? Everything you own minus what you owe. This is where you’re starting from.
  2. What does life cost you now? This is how much you spend a week, month and year.
  3. What is your savings rate? How much of your money do you get to keep each month?
  4. What is the gap between what you have now and 100k, and when do you want to reach 100K? This will help you figure out how much you need to save every month and year.

Once you have this data, you can start to put a plan together on how to reach your £100k target.

Update your mindset on how to save £100k

One of the most important things to remember when saving £100,000 is to have the right mindset.

You need to be motivated and determined to reach your goal, and you can’t let yourself get discouraged along the way.

It’s also important to be patient and stay focused on your goal.

If you’re not used to saving money, it might take some time to adjust your mindset around spending your money all the time.

Open vs closed mindset

When it comes to saving money, it’s important to have the right mindset.

A lot of people struggle to save £100,000 because they don’t think it’s possible, or they get discouraged along the way.

You’ll be less likely to save money if you have a closed mindset because you’re afraid of losing it.

On the other hand, if you have an open mindset, you’ll be more likely to save money because you understand that it’s important for your future.

So which mindset do you have?

If you’re struggling to save £100,000, it might be helpful to change your mindset and adopt an open perspective. This will help you stay motivated and focused on your goal.

Remember, it takes time to save £100,000, but it’s not impossible.

Find the right mentors

An important part of the journey to £100,000 is to find the right mentors.

If you have someone to help guide you and give you advice, it will be much easier to reach your goal. There are many different types of mentors out there, so you should take the time to find one that’s right for you.

Your mentors could be real people you know or virtual mentors you can read, listen to and learn from.

Some of your virtual mentors could include

  • Warren Buffet
  • Mel Robbins
  • Ken and Mary Okoroafor

Once you’ve found a mentor, make sure to regularly check in with their advice – even if virtually to keep you on the path.

Mentors can be a great source of support and motivation, so don’t hesitate to reach out to them when you’re feeling discouraged.

Evaluate your spending habits and find ways to cut back

Spending money wisely is a crucial action when trying to save £100,000.

If you’re not careful, you might spend more than you can afford and never reach your goal.

Evaluate your spending habits and find ways to cut back on unnecessary expenses.

This might mean limiting your grocery shopping, cancelling your TV subscription, or cutting back on nights out.

Cut back on unnecessary expenses

There are many ways to cut back on unnecessary expenses, and it’s important to find the strategies that work best for you. Here are a few tips to help get you started:

Set a budget and stick to it

One of the best ways to save money is to set a budget and stick to it. Determine how much you can realistically afford to save each month, and then make sure you don’t overspend.

Automate your finances

Automating your finances is a great way to ensure that you’re always putting money aside.

You can set up automatic transfers from your paycheck into your savings account. You can also use a budgeting app to track your spending and automatically transfer money into savings when you reach your budgeted amount.

Make use of online tools and resources

There are many online tools and resources that can help you save money.

Money dashboard offers budgeting tools and advice, while sites like Moneysaving expert offer deals and discounts on everyday items.

Cut back on nights out

Going out for drinks or dinner can quickly add up, and it’s important to be conscious of your spending. Try to limit your nights out or find cheaper alternatives like happy hours or BYOB restaurants.

Shop wisely and avoid impulse spending

Shop wisely and avoid impulse purchases.

If you’re not careful, you might end up spending more than you can afford on things that you don’t really need.

Try to stick to a list when grocery shopping, and avoid buying things on a whim.

Try the Kakeibo budgeting method

Another great way to save £100,000 is to try the Kakeibo budgeting method.

Kakeibo is a Japanese budgeting method that helps you track your spending and save money.

To get started, create a list of all your expenses and then track your spending for the month.

Review your spending at the end of the month and see where you can cut back.

Stay disciplined with your spending

One of the most important things when trying to save £100,000 is to stay disciplined with your spending.

This means avoiding impulse purchases and being mindful of how much you’re spending each month.

It might be difficult at first, but you’ll be able to stick to a budget and save more money with practice.

Automating employer accounts

If you want to make it even easier to save £100,000, you can automate your employer accounts.

This means setting up automatic transfers from your paycheck into your savings account or other designated account.

This will help you ensure that you’re always putting money aside, and it will make saving money much easier.

Invest money wisely in order to grow your savings

Investing money wisely is one of the best ways to grow your savings. When you invest money, you’re essentially putting it into a pool of funds that are used to purchase assets like stocks, bonds, or real estate.

Over time, these assets can appreciate in value, which can help you grow your savings.

Trying to save money takes a very long time without the added boost of your savings growing due to interest or dividends being added back to the pot to grow your money even faster.

You need to keep in mind a few things when investing, such as the risk involved, the fees associated with your investment, and your investment goals. But if you’re smart about it, investing can be a great way to reach £100k.

So how can you invest money wisely?

Here are a few tips:

-Invest in index funds: Index funds are a type of investment that tracks a group of stocks or other assets. They’re often seen as a good investment because they’re well-diversified, which means they’re less risky than investing in individual stocks and low cost.

– Understand your risk tolerance: Risk tolerance is the amount of risk you’re willing to take on when investing. It’s important to understand your risk tolerance before investing because it will help you determine which investments are right for you.

-And understand the difference between risk and volatility: Volatility is the ups and downs of the market, while risk is the chance that you could lose money. Volatility is a normal part of investing, but it’s important to understand the difference between risk and volatility before investing.

– Think long term: Your goal is to reach £100k, so focus on that, not the short-term ups and downs of the stock market. The long-term trend is your friend.

-Use tax advantages accounts: ISAs and pensions are two examples of tax-advantaged accounts that can help you grow your money.

With an ISA, you can invest up to £20,000 per year, and any gains are tax-free.

With a pension, you can get tax relief on the money you contribute, and your investment will grow tax-deferred until you withdraw it in retirement.

Make use of online tools and resources to help you save money

There are a number of online tools and resources that can help you save money.

money dashboard: This is a free budgeting app that helps you track your spending and stay on top of your finances.

Top cashback: This is a website that gives you cashback on online purchases. That’s extra cash in your pocket!

Money-Saving expert: This is a website that helps you save money by negotiating your bills, finding coupons, and more.

Candid money: This is a website that has a number of financial calculators that can help you with everything from retirement planning to investment decision-making.

Staying disciplined with your spending and saving habits

One of the most important things £100k savers do is stay disciplined with their spending and saving habits.

This means being mindful of your spending, setting a budget, and sticking to it.

It also means creating a savings plan and making sure you’re automatically transferring money into your savings account every month.

This is a great way to build up an emergency fund and should possibly be one of your first financial goals.  

The bottom line is that saving £100k is possible, but it takes time, effort, and discipline. If you’re willing to make some changes to your spending and saving habits, £100k is within reach.

Create more income-generating assets

One of the best ways to accelerate your £100,000 savings is by creating income-generating assets. An income-generating asset is something that generates regular income for you.

This way, the excess income can be used to help grow your £100,000 savings.

Here are a few income-generating asset ideas:

-Invest in property: Property can be a great income-generating asset. You can generate income from rent, but you can also get appreciation over time.

-Invest in index funds: Another great way to generate income is by investing in low cost globally diversified index funds. The value of the fund will grow in line with global growth and the income the companies produce.

-invest in yourself: One of the best ways to generate income is by investing in yourself. This could be things like starting a business, becoming an expert in your field or creating an online course.

-Create digital assets: Digital assets, such as a blog, ebook, or courses, can also be a great way to generate income. These assets can be created once and generate income for years to come.

-Create your own business: You can generate income by starting your own business. When you own your own business, you have greater control over your income and expenses.

Here are a few tips to get you started:

-Find something you are good at When you’re starting a business, it’s important to find something you’re good at. This will make it easier to be successful and generate income.

-Find something you like doing: It’s also important to find something you enjoy doing. You’ll be more motivated to stick with it and grow your business.

-Find something a lot of people need: When you’re starting a business, it’s important to find something that a lot of people need. This way, you’ll have a larger market to sell to.

-Find something people will pay you for: It’s also important to find something that people are willing to pay you for. This way, you’ll be able to generate income from your business.

-Start small: When you’re first starting out, it can be useful to start small. This way, you can grow your business at a manageable pace and avoid overextending yourself.

-Be patient: Growing a business takes time, so it’s important to be patient. Don’t expect overnight success. Instead, focus on taking small steps and growing your business over time.

-Create a business plan: A business plan is a roadmap for your business. It can be helpful for you to define your goals, build your brand, and attract customers.

-Get started: Once you have a plan in place, it’s time to get started. This means taking the necessary steps to launch your business, such as building a website and marketing your business.

By creating income-generating assets, you can reach £100k much faster than if you were just relying on your savings.

Get and stay out of debt

Debt can be a major obstacle when it comes to saving money. £100k savers recommend getting out of debt as soon as possible so that you can focus on saving instead.

There are a few things you need to do in order to get out of debt:

-Create a budget: A budget is a great way to get a handle on your personal finances and see where you can cut back on spending.

-Create a debt repayment plan: Once you know how much money you have to work with each month, you can create a plan to pay off your debt. This may mean making some sacrifices in other areas of your life, but it’s worth it if it means getting out of debt.

-Consolidate your debt: If you have multiple debts i.e credit card debt with different interest rates, you may want to consider consolidating your debt into one loan with a lower interest rate. This can save you money in the long run and help you get out of debt faster.

FAQ How to save £100k

How can I save £100k?

You can do a few things to save £100k, save more, create a budget, reduce spending, and grow your income. Creating income-generating assets will also help you reach your goal faster.


How long will it take to save £100k?

How long it will take to save £100k depends on a number of factors, including your income and expenses. If you’re willing to make some changes to your spending and saving habits, grow your income and improve your knowledge of money and investing, you can reach £100k within a few years.


Is it worth it to save £100k?

Saving £100k is worth it as there are significant benefits that come with it. These benefits may include financial independence, security, peace of mind, money management skills and the ability to retire much earlier than you first thought.


What are some things I should know before I start saving £100k?

Some things to keep in mind before you start saving £100k include creating a budget, getting out of debt, and finding ways to make extra money. You should also be prepared for the possibility that it may take a number of years to reach your goal.


What can you do with 100k savings?

The best thing to do with 100k is to invest it to grow it more. You could invest it in yourself, property, stocks, or businesses, which should help you grow it further and help you reach financial freedom one day. You can, of course, enjoy a little of the money also.
Final thoughts on how to save £100k

£100k is a significant amount of money to save and an important milestone to reach in building wealth.

Saving £100k is possible, but it takes time, effort, and discipline.

If you’re willing to change your spending and saving habits, grow your income, stay out of debt, and invest your money to create assets, £100k is within reach.

Just get started now and keep going.

If you would like help reaching your first £100k in savings, sign up for our newsletter about managing and growing your money towards financial happiness.

Photo by Sarah Agnew on Unsplash

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Is 100k savings a lot?
Is 100k savings a lot?

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