Six Steps to Successfully Saving

Are you wondering why can’t I save money? You’ve tried but it’s just not happening successfully, for you or for your Family. You “know” you are meant to save, but you just keep getting stuck and the savings don’t grow. What little you do save you have to dip into to spend or unexpected outgoings for the kids or it feels like you simply can’t afford to save with the family income you have.

You’re not alone.

In 2020 1 in 3 UK adults had less than £600 saved with the average across us all still being less than £7,000. One in 9 of us have no savings at all. We’re hear the advice that we should aim for an emergency fund of 3-6 months savings and with outgoings averaging £2,000. This means the money saving ideals would be £6,000. That’s as a minimum and before we’ve saved for any other family plans, dreams, goals.

The impact if our income stopped due to a covid related redundancy, accident or long term sickness on most UK families could be devastating.

Start with what you can control

What are you telling yourself about money and savings? Become aware of the beliefs you have around money. Are you telling yourself you can’t save. You cant’ afford to. You don’t want to. You don’t need to. It will never happen. Do you feel as though saving is pointless or that saving stops you having something you want today. Does the gap between the little you have the amount you need just look and feel too big?

You can influence your thoughts and feelings. Re-frame ‘why can’t I save money’ to something positive such as:

  • I can start saving money today
  • I can create good money saving habits
  • My savings will grow
  • I can start small and increase later
  • I can find the help I need to save successfully
  • I would feel happier when those savings are there

Then use that positive to support the next six steps for real saving success.

How Money Smart are You?

1. Save Money for a Purpose

Savings need a purpose, all money needs a purpose but when saving it really helps to stay motivated and direct the right money to the right place. You are saving to spend on something you may want or need later. That later may be next week, month, year or 3 years time. But it needs a purpose. Spend some time imagining what’s important to you and your family and give that purpose a goal, a name and decide to save toward it.

2. Save For Yourself First

Save before you spend. See saving for yourself as paying yourself and you should be top of you own list. Without you, your income and your savings anyone who is dependent on you also loses out. So put yourself and pay yourself first. Then spend from what is leftover.

3. Save Money in a Separate Account

With the recent changes in digital banking there are os many options for an easily accessible saving or current account. Many have spaces so you can name you saving spaces as individual goals that match your purpose.

If you are saving for the long term (but not long enough to invest) look for the highest interest rate (they are all low at the moment!) or see if you can benefit from a banking switch but also factor in customer service, usability and how easily accessible it is. Just keep it separate and keep the purpose in mind so you can avoid dipping in for unplanned monthly spend.

4. Automate Saving

Life is busy enough and enough decisions to be made elsewhere. Make your money management easier. Automate your savings for a higher chance of success. It doesn’t need to be something you have remember or do each month. Now you are paying yourself first and have a separate space for your savings, set the payment up as a standing order to yourself on pay day. You’ll soon get used to not having it in your current account to spend and your savings will start to grow.

5. Save Consistently

Paying yourself first and automatically will help maintain consistency. But this is where he habit begins and the results will follow. The gap between starting and where you are trying to get to may feel and look big on day 1, but each consistent action with move you nearer to that goal. Consistency is a huge factor in saving successfully

6. Increase Savings Regularly

Review your monthly saving amount regularly. Can you increase it by a further 1% now that you’ve gotten more used to saving regularly? Use a pay rise, birthday or new tax year as a trigger for a regular increase. Remember ad hoc top ups can really boost your savings too. If you have an additional bonus, make money elsewhere, sell something, receive a gift can the first % of this go into your savings too.

Start Saving, Stay Started.

Start with a small amount today. There’s nothing stopping you just putting the first contribution into a savings account right now. Imagine what it is for and know you’ve made a start on saving your money. Then stay started using all the steps above and you will begin to see the savings grow for you and your family.

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