There are certain times, like a new year when it might seem like the perfect point to make a fresh start but good habits can start any time.
Could you improve your savings?
It’s never too late to take stock of your finances and check where your money is going every month. Could you spend more mindfully and make savings? We all like to have a few treats but do you have enough set aside for those untimely emergencies, like a car repair, a leaking roof or even losing your job?
With more than 16m people in the UK with savings of less than £100[i], Yorkshire Building Society is encouraging people to boost their savings this year. How many of these tips can you use to make a difference to your savings?
Tips to get you saving
- Give your finances the once-over – A good place to start is a thorough review of your regular income and outgoings. What are the essentials and what could you do with less of? After the essentials, work out what’s left each month and see if you can cut back on any of those ‘luxuries’ to start saving.
- I’d forgotten about that one – Check out your direct debits. Are you still paying for a gym membership you’re no longer using? Have you compared your utilities prices recently? Maybe you could make savings with the essentials by just switching providers for your gas and electricity or broadband.
- If you find a saving, you could set up a regular transfer to a savings account for the amount you’ve saved. You didn’t miss it before so you shouldn’t now!
- Swap or drop – how about making instead of buying your own lunch each day? Or drop just a couple of shop-bought coffees a week to save over £250 a year.
- Budget – once you have a clear view of your monthly spending, create a budget that works for you and your family and stick to it. Your family budget will have to earmark money for the essentials, but also some cash for the fun things and an amount to save every month.
- A little saving can make a big difference - even £50 a month, or the equivalent of one social night out, would add up to £600 over the course of the year.
Find a home for your savings, and save each month
When you’re saving for something specific or want to build up your savings for a rainy day, rather than simply leaving it in your current account, it’s a good idea to set up a new savings account where you can see your cash build up.
If you’re setting your cash aside, having this separate account can help you avoid the temptation of dipping into your savings.
A lot of providers will let you name your account too, so whether you go with ‘New bathroom’, ‘Monthly set aside’ or ‘Sports car’ it’ll help to keep you focussed on your goal.
There are many different types of savings accounts on the market.
- You could set up a standing order so that money is taken from your bank account automatically each month (such as on pay day), so you can see your monthly budget up front for the month. Alternatively you could sweep any money left in your account at the end of the month into your savings account. You might be surprised how quickly this builds up.
According to the Money Advice Service, saving this way could mean you’ll save more than you would do otherwise. What’s more, this could help you get into the habit of saving on a regular basis.
Louise Halliwell, Senior Product Manager for Savings at Yorkshire Building Society, said: “Saving money can sometimes be an afterthought, with essentials or the nicer things in life taking priority, but starting to build a healthy savings pot doesn’t have to be difficult.
“For those that don’t currently save money regularly, it can be daunting to know how to start. Take a close look at your incomings and outgoings to increase awareness of your situation and from there look at how you could make small changes to the way you spend money.
“You might be saving for a rainy day, or for a specific purchase, but highlighting your savings ambitions and making a plan to work towards them can help make them more achievable.”