We’re saying goodbye to 20-Something Money for now (boo) and seeing it off with the best post of all – making a savings plan.
This week we’re seeing the last in the 20-Something Money series (for now). I’ve saved the best, easiest and most satisfying part till now and, seeing as a lot of this has been covered already, it’s a much shorter read!
This week, we’re talking about creating an savings plan to compliment your budget. Unfortunately, not everyone is able to put money aside each month but if you are lucky enough that your income allows even just a little wiggle room, it’s beyond a good idea to start a long-term savings plan to put money away for a rainy day or special event (Christmas anyone?!).
Open a Savings Account
First thing’s first – open yourself a savings account. Though it’s all well and good trying to simply build up your current account balance, it’s far better to differentiate between your savings and general money supply. Research different accounts in order to find the best deals and work out what bank will be most convenient – I use Lloyds so I can access my current account and ISA in one online interface.
Work Out a Target
The best thing for anything numbers based is to create a target amount that you can build up to. Though I’d recommend contributing to a savings account regularly for life, you may want to contribute a larger amount to begin with to reach a certain balance before cutting back. For example, (if you’re able to) you may want to put £250 a month aside until you’ve reached £1000 then cut this back to £100 after you’ve achieved this.
Of course a target can also exist in an experience or expensive item. You could start saving now for an dream holiday next summer or for that fancy camera you’ve been eyeing up. Whether it’s a holiday, camera, music festival or handbag, if you put away a certain amount each month you can mark down in that calendar you’ve been keeping when you’ll be able to afford it!
Create a Routine
Once you’ve achieved your initial savings goal you’ll want to create a new plan that can run alongside your general money management in the long term, dependent on what you want to use your savings for. My long term savings plan is to split the remainder of my bank balance at the end of each month and put one half into an ISA (to keep for a rainy day) and one half into a savings account (for large purchases like holidays). There are plenty of ISAs and savings acocunts on the markets so read up on terms to find which suits you best.
I’ve had a great time putting 20-Something Money together and would definitely like to bring this back in the future. Is there any aspect of budgeting or saving money you’d like to read about?