Saving up money is hard and often boring. Many of us start saving but end up dipping into our savings, while others may struggle to find the motivation to start saving at all.
Becoming better at saving can be important. It can help us to afford bigger and better things without having to accumulate debts. You’ll spend less in the long run and it will be more rewarding when you finally reach your savings goal and get to spend it (unless, of course, you’re setting aside saving more emergencies).
So just how can you become a better saver? Below are just a few tips.
Create a clear savings goal and stick to it
In order to start saving, you need a clear savings goal. This could be money for a new car, a holiday, a wedding, a deposit on a home, cosmetic surgery or simply some new clothes.
In the case of a rainy day fund (money for emergencies), it’s worth setting yourself a target amount of money.
Make sure to never touch your savings for anything other than their primary purpose. A savings account for a down payment on a home should not be used for funding a last minute vacation. If you want to save up for a holiday, create a separate savings account or savings jar.
Set up standing orders
A standing order will ensure that money automatically leaves your account every month or week. This can be easier than manually contributing money – you may forget or you may decide to put it off.
You may even be able to ask an employer to pay some money directly into your savings account. This way you don’t even get to have it in your current account.
Choose a savings account with restricted access
Some savings accounts have restricted access, which could stop you dipping into them. This could include not being able to take out money without penalties or even not being able to access savings at all for two or three years (as is the case with bonds).
Let other people guard your savings
If you’re really afraid of dipping into your savings, you could ask someone else to set up a savings account in their name. This way, only they can take out savings.
Joint savings account can be a good idea when pursuing joint savings goals. If you take out money from this account, you’ll be spending their contributions too – something which could put you off.
Try investment options beyond savings accounts
There are places to put your savings beyond savings accounts. While some of these options can be a little riskier, you could make a much bigger potential return than were you to rely on bank interest rates.
Stocks, crypto and forex are just a few popular options. You could even access all of these markets by considering CFD trading. Some people may find these hands-on investment options a lot more fun than putting money in a savings account.
Become better at budgeting
In order to make regular savings contributions, you need to avoid overspending each month. This requires careful budgeting.
If you tend to spend without knowing how much is in your account, it could be worth getting into a habit of checking and possibly creating weekly spending limits. This could involve making certain cutbacks. Such cutbacks can be boring, but they need only be temporary until you’ve reached your savings goal, The alternative option is to find ways of earning more so that you can save more without making cutbacks.
