Keep your savings on track
Here are eight simple strategies to give your savings a boost if your willpower is flagging.
Set a budget
Take a look at all your major outgoings, such as road tax or house insurance, and make sure that you know when they fall during the year. Plan to put money aside for these expenses in advance, so that you don't have to raid the savings that you're working hard to build up.
Drawing up a budget will give you an overview of your expenses and outgoings and help you work out how much you can set aside each month.
Case Study
Maria Demetriou, 34
Saving for her son's future.
"I leave my credit card at home."
Maria Demetriou, 34
"I'll be the first to admit saving wasn't really my forte. But since becoming a mum three years ago I've really had to start thinking about the future and I've made a conscious effort to improve the way I manage my money. My first step was to go through my bank statements and to see where I could cut back. Once I'd worked out how much I could afford to put aside each month, I went to see an adviser at my building society. She explained all the savings options that would work for me. So I've set up a Cash ISA, earning me tax-free interest, which I pay into with a standing order each month. I quickly discovered that saving before you spend is so much easier than trying to find the money at the end of the month! I also have a higher interest online savings account which I contribute to, when I can."
What worked for me: "My credit card was a constant temptation, and I really begrudged the interest I was being charged. So I leave it at home now."
Have a goal
Saving for saving's sake is tough. It's easier to motivate yourself if you've got a tangible goal, such as a holiday. Reaching it will give you a real sense of achievement, plus you'll be better off than if you'd used your credit card to pay for it because you won't be paying interest for months to come.
Check your progress
Check your statements regularly so that you can see your savings pot growing. Seeing what you've already achieved will help you to stay motivated.
Make it automatic
It's easier to keep up your saving habit if it's automatic. Check if your employer offers a savings scheme where the money is taken directly from your salary before it hits the bank. Or set up a standing order for a regular monthly amount and watch your savings grow.
Avoid any unnecessary tax
Setting up an ISA for your savings means you'll be able to benefit from the full amount of interest earned rather than giving some of it to the taxman. With a Cash ISA you can pay in up to £5,340 this tax year and not pay any tax on the interest (although tax rules can change).
Treat yourself occasionally
Set yourself smaller goals on the way to your big one. For example, saving a certain amount by the end of the year. When you reach it, give yourself a little spending treat.
Avoid temptation
Try to use cash or your debit card whenever possible. Don't take out your credit card, unless you're really going to need it, that way you avoid unnecessary expenses and charges you can't really afford.
Think about setting up a notice account, rather than an instant access one. A notice account means that money can't be withdrawn immediately. Instead, you have to give the bank a certain amount of notice (usually between 30 and 90 days) when you want to take money out. There is a get-out clause, in case of an emergency, but there's usually a penalty. On the plus side, the interest rate is usually higher.
Set up direct debits
If you're no longer relying on an overdraft, set up your regular direct debits for bills for just after you've been paid. It makes it easier to see how much money you've got left for the rest of the month so that you won't overspend.
