A zero-hour contract is a great way to earn whilst keeping flexibility and freedom in your schedule. But the variety of working hours coupled with those end-of-season sales… well, it can leave you struggling. We’re breaking down our best advice on managing your money and making your work, work for you!

Disclaimer: This is not financial advice; we are not financial advisors! All information within this article is strictly for informational, entertainment, or educational purposes only. Please consult with professionals and conduct your own research before making any financial decisions.

CREATE A BUDGET

Having a budget that works for your needs is important for you to be realistic and honest about your spending habits. This might look like:

1. BUDGETING WEEKLY RATHER THAN MONTHLY

Budget in line with how you are being paid.

Estimating monthly may be difficult, as hours are often irregular on a zero-hour contract.

💡 TIP: Planning is important where possible, but where not possible, the best course of action is to underestimate your income and overestimate your spending. Then you’ll never be short, and sometimes, you’ll find you have money left over at the end of each week/month!

‘But budgeting is so time-consuming and boring!’

We hear you groan… it can be, but it doesn't have to be! It might be as simple as a written list of your income and outgoings totaled up. It does need to be honest, though, and thought out. Anything you forget at this stage might catch you out later! There are hundreds of templates and tutorials online to take advantage of.

2. INCLUDING A FUN ALLOWANCE

Bills? Check. Savings? Check. FUN? Oh yeah...

Don’t shy away from including entertainment spending on your budget. This one’s tricky - it’s going to vary each month with how frequently you go out and where you’re going, and because, let’s be honest, no one wants to be confronted with how often they see the same Deliveroo driver every month. 

Including an allowance specifically for fun spending

This will help to keep that under control, and take away that guilt around spending your money on you! That’s what it’s for, right?!

If you can have your spending money arrive separately (i.e. into a different account) to your income, even better! This is where having more than one bank account can be an advantage, but might not be possible for everyone.

When budgeting for an uncertain income, underestimate what you will make each week. If you’re really unsure, use your bank statements to average out your earnings over the previous few months to get an idea. 

As long as you underestimate, you’ll break even, and sometimes, you’ll have money left over at the end of the month. Then, you can choose either to spend the leftovers or put them into savings. You might choose to split 50/50 - you’ll have something to spend now, and slowly build a pot of savings to help out on quieter weeks in the future.

USE SAVINGS ACCOUNTS STRATEGICALLY

With so many options out there and SO much terminology, it can be difficult to know what to choose. Here are some options for savings accounts that are easy to get the hang of:

1. REGULAR SAVER

Most banks will offer these types of accounts 

You can deposit a certain amount each month (the minimum will vary from bank to bank) 

By being locked in an account, your money will earn interest, usually from 1-5%. 

The catch to these kinds of accounts is, they are not instant access. You agree to keep your money in that account for a certain period of time (usually 1-2 years) and get paid interest in return. After that time has expired, a lot of banks will reduce the interest, and not offer so much. This is why people ‘Switch’ accounts regularly. 

💡 TIP: Most banks will offer perks for switching. This might be an amount of money or offers on goods and services. But be aware, opening multiple bank accounts within a short space of time can affect your credit score!

Explore some options for regular savings accounts here.

We know, the future, it’s just… so…far…away. But putting aside money now, even tiny amounts can really make a difference in a few years' time.

A lifetime ISA is a good option for an additional savings account you might have alongside a Regular Saver. It’s a longer-term savings account, intended for buying your first home or retiring. 

There’s no minimum monthly payment (phew) and when it’s time to withdraw, a 25% government bonus on any money saved in the account. 

Unlike other savings accounts, though, this is intended for a specific purpose. If you choose to prematurely withdraw the money or do not use it for buying a home or retiring, you cannot claim the bonus, and earn no interest on your savings.

There are other options for ISAs, e.g. Cash ISAs, or Stocks and Shares ISAs, which you can find out more about here, so do some research and see what best fits your needs.

If you’re looking for the equivalent of dipping your toe in the shallow end, an Easy Access Savings Account might be a good idea for you.

Most banks will offer these. These accounts are very low interest - up to about 1.5%.

The advantage is, although your money is held in a separate account and not linked to your debit card, you can access it instantly if you need to. 

This option is the safest to begin with, and a real helper in emergencies, getting you used to the concept of regularly saving money, but with a safety net installed.

Some banks instead offer Piggybanking - Monzo and Starling are popular choices. With mobile and online banking, you can set up ‘pots’ to save for a specific goal, and can even automate the monthly payments - very little thought required!

LOOK AFTER THE PENNIES, THE POUNDS WILL TAKE CARE OF THEMSELVES

All this talk of money, interest, banking… it’s all a bit too much, isn't it? The best advice we can offer when it comes to managing your money on a zero-hour contract is to take it one step at a time. Over time, small changes can make a big difference. It’s worth considering:

You’ll be surprised just how much of your money can be spent on eating out without realising. Consider this: if you bought lunch on the go just once a week - let's say about £6.50 - in a year you’d be spending £338. Swapping that out for a homemade meal, costing around £4 (though usually less), you’d save £130 a year! That’s a new pair of Airpods, or a year’s Netflix subscription!

 If you’re able to set aside time each week to prepare lunch, or even snacks, it’s a great way to save a small amount of money that you can watch quickly build up. Don’t be afraid to indulge on ingredients and meals that you love, to make up for what you aren’t buying.

Traveling to work is undoubtedly a massive, but unavoidable expense. 

If you’re attending an event where you find yourself taking the same route multiple times a week, a TRAVELCARD, or SEASON TICKET, may save you money on your travel expenses. You can find out more about Season Tickets here, and Travelcards here.

Working flexibly can be a gamechanger if you are looking for part-time work to build savings, or to support your lifestyle. Sign up with OffToWork, and we promise you that satisfying £££ feeling every week!