It doesn’t matter how little you put away, the trick is to get started.
From clever apps to canny tips, here’s a guide to getting into good habits while still having money for a flutter
Pay yourself first
Rather than treating savings as an afterthought, set up a standing order into a separate account as soon as you get paid, says Anna Bowes, the co-founder of Savings Champion. “That way it can become just another bill, but one that you will benefit from in the future.”
Jasmine Birtles, the founder of MoneyMagpie.com, calls it paying yourself first. “Everyone says they have no money at the end of the month to put into savings,” she says. “That’s why you have to put the money into a savings account at the beginning of the month.”
It doesn’t matter how much it is, says Bowes, as long as you start. Some savings accounts accept payments from just £1.
While most finance experts advocate saving into a pension, retirement should not be your only goal. Shorter-term goals may be more motivating. If you usually pay for your holiday by credit card and pay it back over months, consider saving for it in advance.
Many banks let you set specific markers that show you how much progress you are making towards your target. When you have ticked off one goal, keep saving for the next.
Birtles recommends the “savings jars” offered by digital banks such as Monzo and Starling, which allow you to separate money from your current account, but move it back easily if you need it. Many of these banks also let you set spending limits – either overall daily maximums or for different categories of purchases – then round up your spending to the nearest £1 and squirrel away the difference.
There are also apps that may help kickstart a savings habit. Chip, for example, makes automatic “microsavings” based on how much you are spending. Birtles suggests Moneybox, which lets you put small amounts into an investment Isa. There are fees, she warns, “but it’s still worth doing as it gets you into stock market investing with just 50p here and there.”
Lock your money away
If you find a savings account linked to your current account too easy to plunder, open one at a different bank and pick one without a cash card. You could even destroy the online login details if you really don’t trust yourself.
Alternatively, go for an account that restricts your access. Regular savings accounts often have terms and conditions that you need to stick to. “That could discourage skipping deposits and making withdrawals,” says Bowes.
Have a flutter
Premium bonds may not be fashionable or hi-tech, but every bond you own has the chance of winning you up to £1m. Though you are likely to get better returns from a good savings account, you need just £25 to buy bonds, and they are a bit of a faff to cash in, which should help you resist withdrawing your cash. Plus there’s always the hope that next month could be your lucky one …