No matter what your position in life, it’s always a good idea to save money. Your savings could be a vital buffer in hard times. You may also want to start saving for any long-term goals, such as buying property or going travelling.
Set clear financial goals
Your first step is to define what your savings goals are. Calculate how much you will need to save for each goal and then work out how much you will need to put away each month to reach your goal on time.
One of your long-term goals may also be to improve your credit score. Having a decent amount of savings can protect you from having to seek credit or get into debt, which can keep your credit score in the healthy zone.
Research from the Stirling Management School found that if you set goals, feel confident about your numerical ability and get professional financial advice, you’re more likely to be successful at saving.
Use budgeting and automation
When budgeting, be careful not to treat regular saving as an afterthought. Even if you can only afford to put a tiny amount away, it can add really add up.
To ensure saving doesn’t fall by the wayside, you may want to set up a direct debit to your savings account each month, with a set amount that will go in. If you want to make spontaneous payments to your savings on top of this, great!
There are a variety of auto-saving apps you can try. They can calculate how much you can afford to spend every week and then take small amounts out of your current account to hit your savings goal. Some are AI-powered, with abilities to give you real-time insights about your savings and your spending habits. These can be extremely helpful. Of course, you should always make sure you choose one that is FCA-approved.
Find other resources and tools
If you’re really serious about saving, finding more than one resource to help you is key. Try to go a week or two without spending money on non-essentials and save the extra cash. Find an accountability partner to update on your progress every so often.
Utilise a handy calculator to find out how much it could take you to hit your savings goal, taking into account any interest you may earn.
Lastly, find a financial advisor to talk things through with. They can help you figure out your retirement saving strategy, find the best savings accounts and identify investment opportunities. If your employer offers access to a financial support platform, do take advantage of it! And if they don’t, it may be something for the suggestion box…
The most important thing is that you save regularly. The best way to do it is in a purpose-driven, goal-oriented way!