For many of us, it can sometimes feel as though we’re living from paycheque to paycheque, never saving enough to make a tangible difference to our lifestyles.
In an ideal world, you would save something every month and watch these savings grow to enable you to make bigger purchases with ease or build a buffer for emergencies.
We know this is easier said than done, so we’ve put together some tips to help you start to grow your savings pot.
Educate Yourself on Budgeting
First, it’s important to note that saving money will be simpler if you make a careful plan and stick to it. Keep a diary or log of your daily expenditure. Full visibility on all your outgoings will make it much easier to see where you can cut back.
For a great start on wising up on your monthly budget, check out some of these MYJAR money tips articles:
Deal With Your Debt
It can be almost impossible to save if you’re saddled with debt, whether this be in the form of credit card debts or loans. Debts like student loans can be a long-term burden, but not dealing with debts before you start to save can be counter-productive, since you’re almost always going to be paying more in interest on debts than you’ll gain in interest from savings accounts. As such, you should aim to pay off debts as quickly as you can possibly afford, starting with your debts that have the highest cost of borrowing.
Once you’re debt free, you’ll find it a lot easier to create a realistic savings plan.
Pay off your Mortgage
If you’re a homeowner, the quicker you pay off your mortgage the better. Once those hefty monthly payments are gone, you’ll have much more money to play around with. Additionally, money used to pay over and above your usual monthly mortgage payments is tax-free. If you can afford it, paying off the mortgage early will put you in a great financial position.
Set up a Standing Order
‘Pay Yourself First’ is a tip that you’re likely to come across if you do a lot of research on savings. The theory is that instead of saving anything you have left over at the end of the month, you should save money straight after you get paid, just as you would with your essential bills like rent. That way, you’re making saving a priority, and you learn to be even more frugal with your money, since it’s not sitting there in your account.
Setting up a standing order is a way of ensuring that you’re doing this - don’t rely on remembering to move money from your main bank account to a savings account every month. The likelihood is, there’ll be several months when you’ll be tempted not to save at all. Just sit back and watch the money accumulate.
Comparison Isn’t Always the Theft of Joy
Take advantage of comparison websites. This is particularly useful when it comes to food shopping, car insurance and travel. Doing some research into the most economical options will really pay off. It’s a good idea to add any saving you’ve made after using a comparison site to your savings account – since you’d otherwise have spent it!
Take advantage of some of these really simple ways to make regular saving a habit rather than a chore. A regular savings schedule will help give your monthly budget a structure, and allow you money to fall back on if and when you need it.
If ever you find yourself in need of more money than you’ve saved, you can look into a MYJAR short-term loan. A regular saver with a responsible attitude to personal finance can take out a loan safe in the knowledge that they’ll be able to repay on time.
Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk