Given that a quarter of people in the UK have no savings at all, it seems fair to assume that accruing savings is far from simple. While most people know that they should be saving, when faced with a monthly budget that doesn’t seem to stretch as far as one would hope, actually setting money aside for a rainy day becomes extremely challenging.
If you do not currently have any savings, then actually getting started can be even tougher still. As your savings will initially be relatively small, it can be psychologically tricky to convince yourself to leave your savings alone, especially when there are other expenses that you need to meet. However, it is possible to build significant savings from a low starting point, especially if you keep the following points in mind…
#1 – Read all the advice you can
When you first start saving, the subject will initially seem rather complex and overwhelming – you may find yourself unsure what all of the different savings options are, or how you can begin to set aside funds to save. Thankfully, there is a wealth of advice available online that can help you, ranging from tips from the likes of CashFlex to blogs dedicated to making savings easier to process. It is therefore helpful to make use of as many resources as possible until you feel more comfortable with the idea and can get the most from your first experience of saving money.
#2 – Every penny counts
As we touched on above, when most people begin saving, they have a relatively small amount to start with – but it’s helpful to remember that even the smallest amounts can be beneficial. Let’s say that you set aside £25 as your first contribution to your savings; such an amount can seem so small it is hardly “worth” saving – but imagine a scenario where you receive an unavoidable, sudden expense for £50 a month later? Yes, you still need to find the remaining £25 out of your everyday budget, but that’s far easier to manage than finding the entire £50. When it comes to savings, anything is better than nothing.
#3 – Work towards goals before saving “generally”
Savings are often talked about as just general savings; an amount of money that everyone should have set aside, to be used for no specific purpose. While general savings can be useful, for first-time savers, the lack of purpose can actually make it trickier to set money aside. If there’s no specific goal for the funds, and someone is short on cash for their day-to-day needs, then it’s easy to see why it could seem almost pointless to just having funds just sitting in an account when they could be used to meet everyday needs.
Due to this, it’s usually best to start saving for a specific need, purpose, or goal; a budget to buy your home, the family holiday of a lifetime, or even just a day out with your kids during the summer holidays. By setting a goal, it’s far easier to see the funds you set aside as being set aside for an exciting reason, and working towards that goal will allow you to develop saving patterns that you can then rely on for general savings in the future.
#4 – Be kind to yourself if you need to use your savings
Yes, in a perfect world savings would always be locked away for a rainy day that never comes – but if that rainy day does come, then try not to be too disheartened. Yes, there’s no doubt that having to empty your savings is tough to take, especially if you have to do so prior to reaching a specific savings goal. However, the money is there as a way of protecting your everyday finances; if it has to be used, it has to be used.
Instead, try to see dipping into savings from a positive point of view. You had the money available when you needed it, which is something to be thankful for. What’s more, you had that money set aside because you had successfully saved – and if you’ve done it once, you can do it again.
If you have never made a dedicated effort to start saving before, then starting to do so is never as straightforward as many people believe. However, with the advice above in mind, you should be able to start your savings journey today – much to the benefit of your family’s financial well-being in the future.