Spring is here and it’s time to clean the house and start a diet, right? It’s also an excellent time to evaluate your finances and think about saving. If you’re not used to saving or you’ve tried it in the past and failed, read on. On this short guide you will find some useful tips to help you get started.
MAKE IT A HABIT
Saving can be difficult, especially if you’ve tried it before and failed. The failure to save is often a barrier to trying it again, but you should try it again. The secret is to change your lifestyle habits in the same way you might go on a diet.
Instead of thinking of pay day as a chance to splurge on all your favourite things, think of it as a chance to save. Set up a standing order for the day or a few days after so you don’t miss the money.
USE PAY DAY
When payday comes along there is a tendency to go online and buy all those items built up on your wishlist or get an expensive takeaway. Of course it’s important to treat yourself, working would be motivating otherwise, but stay within reason.
The fact is that you probably can’t increase your earnings in the short term, but you can change the way you spend. By altering your spending behaviour you open up opportunities to save. Take advantage of this strategy, especially on payday.
Interest is a way of investing your money safely and growing it in the long term. Banks and building societies, as well as online accounts, offer interest as a reward for keeping your money with them. This interest amount varies a lot, so find the best rate.
You also want to find the best rate so you can earn compound interest. This is when you earn interest on the interest earned. In short it means that the more you can save the more you grow your savings in the long term.
SAVE WHAT YOU CAN
Many people choose not to save because they only have enough money to get by for the money and don’t have any left over. This is fair enough. The fact is that life is expensive these days and sometimes it’s virtually impossible to save.
That said, if you look at your lifestyle there are probably one or two item in the month you could save on, bills are one of them, right of way rules auto insurance is another. If you
can make savings on these how much extra would you have per month to save?
What do you mean, invest regularly? You don’t have enough money to save yet, right? This is a common attitude among those trying to save, but actually, investing is something you do anyway without realising and it can accelerate your savings.
When you put money into a savings account you accept their rate of interest, this is a form of investment. If you choose a higher interest rate like a stocks and shares ISA you will accumulate a lot more. You don’t have to invest much, even £20 per month can go a long way.