How To Get More From Your Savings

So, you’ve finally decided to start saving some money for the future. Whether you have a specific reason for saving or you just want to put something away, it’s important to consider carefully the particular account that best meets your needs. It might seem easier to open up the first savings account you see, but a little consideration and research could pay dividends in the long-run.

To get it right first time, you need to think about what you are saving for. It could be something very specific, such as a wedding, your offspring starting university, or perhaps a special holiday you have in mind for when you retire. In this case, you will be more prepared to tie the money up for a longer period of time.

This is quite different from just saving for the proverbial rainy day. In this case you simply don’t know when you will need the money - you might save it up for years and never touch it or an unforeseen event could mean that you need access to your cash at short notice. This means you’ll need an account that is more accessible, and one that doesn’t limit you to just one or two withdrawals a year.

Needless to say you will get more interest if you can tie up your money for longer. Be sure that this won’t cause a problem before you agree to such an account though; you can sometimes be required to pay a penalty if you later have to withdraw the money without giving the appropriate notice.

Once you know how flexible you can be, you can start to think about which account to go for and begin to learn what interest rates are available. It’s worth spending some time comparing different offerings and accounts to get the best possible deal – especially if you’re compounding the interest on your accounts (earning interest on the amount of interest you have already earned). This can make a big difference a few years down the line.

Make sure you read the small print to ensure you get the most from your account. For example, if you are considering an ISA account, research the types of account available and do your suns to ensure that you have chosen the right one for your needs. As with any type of savings account, not all of them offer exactly the same service, so you should always check the ISA rates being offered.

Saving a little money for a life event or rainy day is always a good investment. However, a little research could be the key to maximising your money and selecting an account that really suits your financial needs.

Victoria Cochrane

Smart Thinking: Saving Money For The Future

While we are all aware of the importance of putting away money for the future, the reality is that saving doesn't come naturally to most of us. When it comes to putting money away, setting "smart" goals is the first step in finding the motivation to save.

What are "smart" goals? SMART is a popular acronym for specific, measurable, achievable, realistic and timely. These five characteristics are vital for setting goals and the acronym provides an easy way to remember each of them.

When it comes to saving money it is important to make sure a goal is specific. Rather than telling yourself that you need to put away a little money each month, set a specific figure. This will give you a balance to base the rest of your monthly spending around, as well as a measuring stick to see whether or not you are achieving it.

Why is it important to have measurable goals? If a goal is not measurable, it's difficult to know whether you are actually achieving your goal. A measurable goal means that you will be able to monitor your success and hopefully this will give you a boost to continue saving.

To really achieve a goal it is important to take an action-orientated approach and hone in on all the proactive steps you need to take to achieve that goal. Ask yourself what actions are needed in order make this ambition a reality. From deciding how much to save, to deciding which savings accounts offer the best deals - all of the actions you take will form a vital part of achieving that goal.

While breaking your goal down into mini-actions is extremely important, it is even more important to make sure the goal set is realistic. Is the figure you have set yourself going to over-stretch your budget? Do you have any major outgoings over the next few months which could hinder this goal being achieved? If your goals are not realistic, they will only cause you anxiety; therefore, it makes more sense to save little and often, as opposed to setting an unreachable target.

The final step to smart goal setting is making sure your goals are timely, which refers to having an overall timeframe for your goal. It can also help to set some timely milestones to monitor your progress along the way. In a similar way to setting mini-actions towards your overall goal, setting mini-milestones breaks the process down into shorter, simpler steps - making the goal seem all the more achievable.

When considering your savings and the savings accounts which will work best for you, it is all about thinking smart. While it may take a little extra time to set your goals the smart way, it could pay dividends in the long-run.

Victoria Cochrane

Budgeting Is The Secret To Saving

Saving on a regular basis may seem like a mammoth undertaking and one that you could only achieve after a hefty pay rise. In fact, this is one of the common excuses that we all use to avoid building a nest-egg, but putting a little money aside each month should not be seen as a pursuit only for those with money to burn.

In fact, saving can be a straight-forward process that is achievable by anybody, regardless of their monthly income and financial outgoings. All that is needed is careful planning.

It can be easy to become accustomed to a certain way of life and assume that to spend any less money would mean having to make major sacrifices, hence making life less enjoyable. But through carefully monitoring exactly how much is spent each month – from the little things such as your lunch and travel budget, to the bigger things such as the mortgage and bills – it is then possible to start making some fundamental changes that can free-up a regular contribution to your savings balance, without having a significant impact on your daily life.

In the first instance, make a note of everything you spend – big and small - each day for a whole month. The first thing you’ll notice is how all the little things actually add up to quite a lot over the course of a month.

For example, it’s estimated that the average worker will spend around £5 a day buying their lunch. And even taking into account weekends and holidays, that’s an excessive amount of money every year on unnecessary lunchtime treats. By bringing in homemade lunches everyday it’s possible to make considerable savings for a modest effort.

Transport is another issue to consider. Whilst many people simply wouldn’t consider losing their car completely, it’s certainly worth thinking about using it a whole lot less. The car may be useful for the monthly shop, but for shorter trips it could be better to walk or take the bus instead.

But of course, it can be difficult to imagine all these potential savings every month without seeing an actual final figure. If you don’t have the time to tot up your savings yourself, you can also take a look at a simple budget calculator tool which is available to anyone with internet access. This breaks down all your potential monthly outgoings into categories, and makes all the necessary calculations to show you how much you stand to gain from taking control of your daily finances.

Remember, saving doesn’t require drastic lifestyle changes. By carefully monitoring how much is being spent on what, you can identify savings that can be made without a massive impact on your personal life. And by watching the pennies, the pounds will eventually take care of themselves.

Victoria Cochrane