10 May 2023
How to Start a Savings Habit
Are you struggling to put money away? Finding your savings accounts filled with all the wrong zeros?
With all the current demands on your money, starting a savings habit can seem like a difficult task however, putting money away is a vital part of financial confidence and freedom.
An emergency fund can provide an all-important buffer against periods of insecurity, especially in our current age with prices increasing consistently, whilst long-term savings can help you work towards future goals such as buying your first house, going on holiday, or even buying a car. Having savings not only gives you security, but freedom too.
Start Good Habits
Saving money is a habit, like exercising or eating healthily, and once you get over the initial fumble and see the benefits, it becomes easier to do.
If you find that you’re struggling to put away as much money as you want to, take a look at your routine, and see if there are areas where you can improve on your spending. The easiest way to do this is to set up a budget, something we have already covered here at Smart Money Cymru. Why not take a look?
Try setting a savings goal too, as this will help you stay on track – we even have a savings calculator to help you do just that!
How Much Should You Save?
Whilst there’s no rule as to how much you should put away each month, even £1 is better than nothing, there are helpful guidelines to help you figure out an amount that makes sense for you and won’t break the bank!
A good guide for budgeting is the 50/30/20 rule. This is where you look to spend 50% of your income on essentials such as your mortgage, rent, food, or bills, 30% on “fun” things such as shopping and socialising and then 20% for, you guessed it, your savings.
When looking to build an emergency fund, remember that you should look to have between three- and six-months’ worth of expenses stored away.
Savings WILL Mount Up!
Once you start your savings’ habit, you will soon find that your money begins to mount up and before you know it, you’ll have a little nest egg stored away.
For example, if you put away £50 each month at the start of the year, you’ll have amassed £600 by the end! Continue and you’ll end up with £3,000 after five years!
If you are able, why not increase that number? Why not try £100 a month and watch as over five years you reach £6,000!
At the end of the day, however, remain realistic and choose an amount you know you’ll be able to maintain – of course emergencies may arise at times, but try and ensure you’re putting something away each month, regardless of how much it is.
Also, if your salary increases, so should your savings!
Where Should I Put My Money?
There are an array of accounts available to save your money, from Current Accounts to ISAs. At Smart Money Cymru we have a range of savings accounts of our own, for many different reasons!
In fact, we offer many of the services that high street banks and building societies offer, but with some key differences – we’re ethical, and you’re in control.
Regular Savings – You can open a Regular Savings account with us for many reasons – rainy day fund, wedding, DIY, new car, university fees… you name it, save it!
Christmas Savings - Christmas can put a huge amount of financial pressure on families, which is why we can provide our very popular Christmas Savings account.
This account allows you to save throughout the year to help spread the cost of Christmas. With this account, you can save regular amounts or make one-off payments. The account is then locked until November 1st, ensuring your money is safe until that special time of year!
Junior Savings - Our Junior Savings Account is suitable for all children from birth to 18 years old. Accounts can be opened with as little as £1 and anyone can pay into the account.
You can pay into a Young Saver Account by any of the payment methods we offer, including splitting a payment. For instance, if you opt to save a regular amount from payroll, standing order or benefits, you can instruct us to put part of it into each of your children’s accounts, and some into your Christmas, Share or Loan accounts!
Savings At Work - You can make savings directly from your pay if your employer is one of our partners.
Setting up Payroll Savings is simple. All you need to do is join us first as a community bank member, then complete an Invisible Saver Authority which we will then send to your employer.
Saving money can provide important benefits – no matter how much or how little money you have. Making a commitment towards saving allows you to work towards your financial goals and gives you peace of mind should an emergency arise.
To open a Savings Accounts with us just complete our online form, or for a more detailed chat about what our Savings Accounts look like, get in touch!