4 ways to create good saving habits

Saving might not come naturally to most of us, and it’s easy to get caught up in the day to day and avoid seeing it as a priority. Unexpected surprises and hidden expenses are just some of the things that can prevent us from getting started on our savings journey. 

But there are ways to take control - here are four simple tips to help you get your savings moving in the right direction.

1. Be honest with yourself

One of the quickest ways to break your saving commitment is aiming too high too soon and ending up working towards an unrealistic goal. 

You don’t have to save a high amount for it to be worthwhile - the focus should be on working out what you can honestly afford to save while remaining consistent. Could you start today by putting £50 aside every month? Much like the gym, saving isn’t about instant results, slow and steady is the way forward. 

To manage to save for the long-term, you will also need to ensure you allow yourself to have some fun too! If you start robbing yourself of all of life’s little pleasures or tightening your belt too much, you’ll find it much harder to keep going. Remember, it doesn’t have to be all or nothing – employ some moderation, but keep at it.

2. Have a plan

Like getting fit, it’s much easier to make progress when there’s a goal in mind and something to work towards that you’re excited about.

Have a plan for how much you want to save each month and sit down and think about what you’re trying to achieve with your savings. It could be something short-term like a holiday, or a new car, or you could be looking at medium to long term goals too, like a wedding or your first house. Call the savings account something that will resonate and remind you why you are saving.

For example saving for a 10% house deposit in 3 years for a £250,000 home could be ‘A home of our own’ and the target would be £25,000 or £700 per month.

3. Automate it

The best way to save consistently is to make it as easy as possible for you. If you don’t have a separate savings account, open one as a first step, then set up a standing order, which will regularly transfer money from your current account into your savings account.

You can also check here if you have access to Salary Finance’s Save, a hassle-free savings account where you can save directly from your salary, making it extra easy!

4. Consider where your savings are

Putting your money in a current savings account is definitely the first step towards building your savings fund but it isn’t always the best way to grow your savings as interest rates for current accounts are usually low. 

You can check comparison sites like moneysupermarket.com and Switchd to help you understand the interest rates across different standard current accounts. You might find some savings accounts that pay higher interest rates but these are normally for a fixed period and based on minimum monthly deposits so make sure you read the small prints. 

You can explore Individual Savings Accounts (ISAs) too. You can put £20,000 into your ISAs without paying income tax on the interest you earn, so in a sense it’s free money. Some ISAs are more flexible because if you take money out, you can put it back again in the same tax year, without it messing with your £20,000 annual ISA allowance. .

We hope these four simple tips will help you get started on your savings journey. For more content on saving, click here.