Setting a savings goal

Whether it’s a boiler breakdown or a family emergency, savings can cushion the blow of that unexpected bill. Building a savings pot is an important step to healthy finances. Follow our tips to get started:

1. Set yourself a goal

Give yourself the focus of a realistic savings goal and you’ll be surprised what you can achieve. Write down your goal and think about how much you could realistically save each week or month to get there.

2. Start small

Small savings soon add up. What daily or weekly savings could you make in that time? Here are some ideas:

  • Saving 60p a day (e.g. a chocolate bar) would give you £219 after a year

  • Saving £2.40 a day (e.g. a coffee) would make that £876

  • Saving £30 a week (e.g. a night out) would make you £1,560 better off

Spending just £1 less every day would save you an extra £365 in your pocket. That's £3,650 over 10 years (£3,653 with leap years)!

It sounds obvious, but spending less is the key to saving more. And we've already given you the tools you need to do it.

3. Keep your savings separate

By leaving savings in your current account, it can be tempting to spend the money. Try keeping your savings in a separate account, or locked pot if you use a bank like Monzo. If you’re not already, you could even use Loqbox Save to grow your savings and your credit score at the same time.

4. Pay in regularly

The best way to build your nest egg is by creating a savings habit, so try to get used to making regular payments — just what you can afford, as often as you can afford to. Or if you prefer to put it aside immediately after payday, you can help to remove the temptation to spend it!

5. Set aside something to fall back on

It’s good practice to put aside some money in case of an emergency. As a general rule of thumb, you should have enough to cover essential outgoings for three months. For example, if your rent, utility bills, and council tax came to £1,000, you should look to have £3,000 to fall back on. This may seem pretty daunting but we all need to start somewhere.

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