It’s that time of year again when we’re thinking about getting our finances in order and making resolutions to help us achieve our savings goals. So read on for some easy-to-follow tips to help you change your spending habits and boost your savings.
1. Check where your savings are currently being held – they may be earning no interest
A good place to start in the New Year is to check where your current savings are being held. Interest rates may be near all-time lows, but the worst thing you can do is earn nothing at all.
2. Think about what you’re saving for, to help you find the right savings product
It’s definitely worth investing some time looking around for the right savings product for your goals. Are you saving for a short term goal? In which case you might require instant access, or are you happy putting money away for a few years for a more competitive rate?
3. Start a budgeting regime to divvy up your income
The 50/30/20 regime allocates 50% of your income towards necessities, such as housing, transport, food and bills, 30% on wants, such as dining out and shopping for luxuries and the remaining 20% towards savings.
This rule is a good starting point for changing your spending habits but if you’re on a low income, spending half on necessities might not be achievable. You can of course adjust the rule to something more tailored to you. Overall, being disciplined is key. While it may seem challenging at first, you’ll start reaping the rewards of a much bigger savings pot sooner than you think.
4. Don’t let monthly standing orders drain your savings potential
Car insurance and gym memberships are two types of payments which are often cheaper if you pay yearly, instead of monthly. What’s more, there may be cheaper rates up for grabs at quieter times of the year so it’s worth digging around. While you’ll need a lump sum to pay in one chunk, you’ll save money in the long-run.
5. Check bank statements carefully and regularly for unnecessary direct debits
It’s very easy to sign up for automated payments such as gym membership or online editorials and forget you ever subscribed. These drip feeds of cash can add up to significant sums over time. The key here is to check your bank statements regularly to remind yourself what you’re paying for and whether these regular payments are worth the expense.
6. Use comparison websites to shop around for the best deals
Online tools, such as money comparison websites, can help you discover the very best deals out there for services like electricity, internet or your mobile phone. They’ve also upped the competition between providers which has helped drive down prices for customers.
7. Do you need it? Or do you want it?
We all deserve a splurge now and then, but constantly spending on regular treats may be sabotaging your savings efforts. Small, habitual changes over time, such as making your own coffee or lunch a few days a week could mean more pennies in the pot for, let’s say, that long dreamed of holiday in the Caribbean.
8. Use a savings tracker to help stay motivated
As well as making these individual changes, finding a tool to keep track of your savings progress can help to keep you motivated. With Aldermore’s Personal Savings accounts, you can set up individual savings targets in your online account, based on how much you want to save and by when. You’ll be able to see how much you need to save monthly to make sure you smash your end goal. Or alternatively you can say how much you can afford to put away monthly, and it’ll tell you when you’ll be getting on that plane to Barbados!
Remember, small changes to daily or monthly habits and shopping around a bit more for the best deals can make big changes to your savings targets – whatever they may be for.