Thrifty living: Why does saving money end up costing so much?

Some urgent questions about money. Is it better, spiritually and mentally, to work from a positive balance where your debts have been hidden away (or rather, offloaded on to a loan with a high interest-rate), rather than a permanently negative account that's always overdrawn? And why is it that money streams out of your account faster than it clocks in; that the £300 spent at Topshop makes a far, far bigger dent than the same amount earned?

If your situation is one of perma-overdraft, do you comfort yourself by thinking of your "ghost balance"? Do you envisage how chock full of money your current account would seem were you to be paid in full, and instantly, by everyone who owes you? Furthermore, why is it that when they do eventually cough up, the money owing is never enough to set your balance straight?

And why is it that it's always the biggest institutions that owe you money? And why is it you who will end up paying hideous, irretrievable bank charges when it's not your fault your account is overdrawn, but the fault of the giant institutions who owe you money?

Next, cashpoints. Is it better to take £20, five times a week, out of a cashpoint, or £100 once a week? Withdrawing a ton means you have a load of crisp notes ready and waiting in your wallet to blow on inessentials – taxis, lattes at Starbucks, nail varnish. Surely it's better to take out a measly £20 a time, which is then spent almost immediately? It is far more sensible to walk past shops with zero cash than with £100, because the fag of getting out your Switch card is a disincentive to shop.

On the other hand, having no cash whatsoever means that you sometimes end up spending more money than you bargained for, since some small shops won't take Switch/Maestro. Paying by plastic at your favourite little Italian café for a cup of coffee is clearly ridiculous, so what happens is that you end up having the coffee but then having to augment the bill with a bottle of olive oil, an iTunes token and a panettone cake. By the time you leave, you have actually shelled out about £22, only because you wanted a cup of coffee, which is clearly ridiculous.

Is it better to keep, or to chuck? A tidy house equals a tidy mind, and thus (hopefully) a tidy set of accounts, but if you have thrown everything you have ever worn away, you will be left with no clothes whatsoever, meaning an urgent credit-card-exercising trip to H&M. Alternatively, is it better to buy "classics" from Issey Miyake, which theoretically never date and can be worn year after year? Five years ago, I invested in a £400 coat from Issey M. It's fabulous – but a) it must only be cleaned with a £40 dry-cleaning experience, and b) it has become a bit boring to wear. Would I have been better off buying a one-winter wonder from Matalan or Tesco and then junking it? Children's wardrobes are equally problematic. Once your child learns to speak, you will find it has clear likes and dislikes. Must I force them into £50 Boden dresses, which they do not like, but which seem to last longer than nuclear waste and whose hand-me-down potential is like The Neverending Story?

Childcare is next. Our deal with the nanny is that I pay her an awful lot of money up front but get one night's free babysitting (during the week) thrown in. But I don't always want to go out in the week, every week. Must I use this babysitting every week? After all, if I don't take advantage of it, I'm wasting a good £30. And so there are times when Mr Millard and I have found ourselves watching a rather dull play at a theatre, at a ticket cost of £30 (or more), purely because we have already paid for the luxury of a babysitter. Is this mad? When we can't be bothered to catch the Tube home and blow a further £15 on a taxi, I rather fear it must be.

The same goes for pre-paid zoo tickets, half-price children's tickets to the cinema and "bargain" vouchers for children's novels from World Book Day. Yes, they all involve a reduction in cost, but it's a reduction that only comes after you have shelled out.

This is how I still manage to spend money when ostentatiously demonstrating that I am saving it. After all, if I'm only kidding myself that my thrifty actions are saving me money, then someone somewhere has been jolly clever with the marketing of all this.