Are you struggling to stick to your saving goals? Saving money for a large purchase, or even just a rainy day fund, can require a lot of willpower, so it’s not surprising that many people find it difficult to save instead of spend. If you’re hoping to become better at saving money in the future, here are some top tips for you to follow.
Set up savings accounts
One of the biggest mistakes you can make is keeping your savings in your normal bank account. By doing this, you can’t easily keep track of your savings, and you may be at risk of accidentally spending your savings as all of your money is in the same place. Having a separate savings account is the best way to monitor your money and earn interest.
In addition to savings accounts, you should also consider getting other types of accounts such as an ISA or a private pension. With these more specialised accounts, you can save money for a specific purpose (e.g., a house deposit) and take advantage of tax-free bonuses. Take control of your financial future today by opening these savings and investment accounts.
Create a budget
How can you know how much money you’re able to save if you don’t look at your expenses and write a budget? To get started with saving, you need to look at your bank account and write down exactly what you’re spending and saving each month. This will help you identify problem areas and think of better ways to manage your money. With this new information, you can then think of sensible spending limits per category and write a monthly budget, helping you set aside a certain amount of money each month.
Save before you spend
Once you have a budget and a savings account, you should think about regularly transferring money. To help you avoid spending too much, you should set up a standing order to move your monthly savings to your savings account right after you get paid. Since you’ll have a detailed budget, you’ll know exactly how much to transfer each month without compromising your ability to pay your bills. Moving this money right away will stop you from spending it throughout the month.
Identify spending triggers
Think about what situations or emotions can push you into a shopping spree. Do you shop when you’re feeling sad or stressed? Are you tempted to spend too much when you’re out with friends? Identifying these spending triggers can help you prepare yourself when these situations arise. Finding healthier coping mechanisms would also be extremely helpful. For example, you could go for a walk when you feel stressed or talk to a friend or family member instead of shopping.
Set ambitious goals
To give yourself more motivation to save, you should set ambitious saving goals. For example, you could aim to save enough for a house deposit, your dream car or a holiday within a certain amount of time. This will give you something to look forward to and make all of the saving worthwhile!