Is it really possible for anyone to have savings any more?

Times are tough for pretty much everyone at the moment, and finances are stretched to breaking point. 

So it should come as no surprise that results of a recent survey by The Money and Pensions Service indicate that a quarter of UK adults have less than £100 savings, and the majority of these actually have no savings at all. 

With the rising cost of living, it just seems impossible for anyone to have savings any more. But the economic climate makes it more important than ever to save money so that you have something to fall back on if you need it.

In this article we explore five ways to start building up savings even in these difficult times.

Make daily no-spend decisions

We are all already having to make no-spend decisions just to make ends meet. But if you also want to start building some savings, look for other opportunities to put aside a bit of money. For example, any time when you might usually buy a newspaper or magazine, coffee or a drink, or a sneaky bar of chocolate, decide to say no to that, and put the money into your savings instead.

It may not happen every day, but even if you manage not to spend £1 that you normally would have done, for four days a week, you’d still be able to contribute over £200 towards your savings over the course of a year.

A regular savings challenge

Another thing worth trying if you want to save money is to set yourself some kind of regular savings challenge. 

A good one to get you started is the daily penny challenge. The idea is you start on day 1 by putting aside 1p, then increase that amount by 1p every day. So on day 2 you’d save 2p, day 3, 3p. And so on. If you do this every day for a year, you will end up saving £668. Towards the end of the year you would need to be saving larger amounts per day – £3.65 by day 365. But by then you will be into the habit of putting money aside, and hopefully your financial situation might also have eased.

If a daily challenge seems a bit of a hassle to do, you could do something similar on a weekly basis. 

Base your savings on the week of the year : for example if you started at the beginning of January that would be week 1 of 2023. Then choose a realistic sum that you think you could manage to save. For example each week save 5 times the week of the year. So week 1 would be 50p, week 2 £1 and so on. There are some larger amounts towards the end, but you could end up saving almost £700.

Fundraising

Another way to give your savings a quick boost is to do a one-off or short term fundraising blitz. Think of some new and creative ways that might be able to bring you in a bit of extra money that you could put straight into your savings. 

Why not consider:

• selling unwanted items, either online or at a car boot sale;
• making things to sell locally, for example cakes, jewellery, accessories, cards;
• offering a service such as babysitting, pet sitting, cleaning, computer or admin help, DIY or odd jobs.

All of the above can help you to bring in extra money that you can then squirrel away for your future.

Save money that you don’t have

This may sound strange but if you have no spare money at all to save, make sure you do save any unexpected money that comes in.

For example, if you receive any work bonuses, gifts from family or friends, or are lucky enough to win any money, you then have money that you previously didn’t have. And yes, you can probably find a thousand uses for it, but why not put it straight into your savings account instead? If that’s too hard, perhaps put half of it into your savings and use the rest for other things.

Another little tip on how to save money you don’t have is to do a thorough search of your home for any money. You may find bits of cash in bags, pockets or even down the side of the sofa, or perhaps some leftover foreign currency from a previous holiday. Also, if you come across unused gift vouchers and are not likely to use them, did you know that you can sell them online at sites such as Card Yard? 

All of the above ways can help you put unexpected money into your savings.

Open a new savings account

The final tip on building up savings is to open a separate account for them. Look for an account with a good rate of interest and check the rules about taking money out of it. Ideally you want an account that enables you to take money out if you really need it, but that you can’t keep dipping into – otherwise your savings will soon drain away. So perhaps try to find one that has a fixed number of permitted withdrawals during the year, which could be the ideal compromise.

We hope that the above tips will help you to gradually start building some savings, even in these difficult times. It doesn’t matter how small you start, the important thing is that you do get started. Like everything else, saving money is a habit and will take a while to develop into a natural part of your life.

Good luck! And do visit us here again soon for more financial and lifestyle tips from Loans 2 Go.