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Guide to increasing your savings

This guide has been designed to show how one can increase their savings and make that hard-earned cash work for you now with the golden tips provided.

Strawberry plant growing, symbolising growth

Focus On your Goal

To begin on building your nest egg, you could set yourself a savings goal to aim for. Your target should be achievable within your budget and most of all realistic.

Try to aim to build up your savings cushion with the minimum of three months’ of your salary. This will enable you to have an emergency fund if the inevitable should happen such as job loss. With the present rocky financial climate and unemployment on the rise, you should aim to have enough cash to cover your living expenses for at least six months, therefore keeping a float until you find security again.

You can add minimal amounts to your emergency savings cushion each week or month. Only put aside what you can afford and you may be surprised at how quickly your savings cushion will grow.

If you spend it as soon as you get it, then it may be worth setting up a direct debit or standing order into your savings account, from your current account the day you are paid your wages. In this way, you can ensure you’ll manage to save something each month, without remembering to put money aside.

It’s vital that you remember this is your emergency savings cushion, so you won’t feel tempted to dip into it for any non-essential spending. If you want to save some cash for a new wardrobe or holiday, then you could open up a separate savings account for that purpose.

Cutback for cash

By making cutbacks, you can free up your spare cash for savings. Start by writing an expenditure sheet, you can then list your incomings and outgoings to get a clearer picture of your finances and identify the areas you can cut back on, and then place these savings into a separate account.

You can cut back on items such as your daily newspaper, the odd coffee, your travel costs by choosing different routes or walking to work. Little adjustments can save you a few pounds each week, which will soon add up.

Set yourself a strict but manageable budget, and then you could find yourself saving hundreds over the months. You can give yourself a set amount of cash each week for your essential household items and bills, then put aside the rest.

By cutting down on your day-to-day living costs, your cash should soon mount up. From switching providers such as your utilities supplier, you could make big cash savings. By switching broadband suppliers, you could also save your cash. Keep an eye on when limited offer contracts run out otherwise you will be paying a lot more than the start.

You could cash in on your hobby to make some extra cash or take up a new skill to earn yourself extra money. By working a few extra hours at work, you could top up your savings by hundreds over the year. Even find part time work on weekends by freelancing a specific skill you possess.

Forgotten or dormant accounts - either savings or current accounts could contain cash you simply forgot about. Therefore, you could begin now to reclaim what is rightfully yours.

It’s all in the account

By picking the right type of savings account, you could make your cash work for you and suit your individual needs.

So for your emergency savings cushion, you may need an account that offers instant or easy access to your hard-earned cash. You can check out instant access deals to boost the return on your cash. Try to avoid notice accounts, as it’s pointless for you to wait 60 or 90 days to access your cash if you need it in an emergency.

Regular savings account may have tempting interest rates, but you may lose interest when you take your cash out. You may also be penalised if you don’t make a regular monthly deposit.

Hunt down the top rates and keep an eye on the best rates on the market. Don’t be afraid to switch to a better account with a higher rate if it comes onto the market, but check the small print for any penalty clauses or if the tempting offer or bonuses end after a certain period.

It’s wise to review your savings account at least every six months and switch if you hunt down a better rate of interest.

Read or repent

When you decide upon the right savings account for your financial cushion, then make certain you read the small print. However tedious the task, you need to be savvy about what the terms and conditions are before you sign on the dotted line. Here are some tips to make sure you aren’t caught out.

With a strict budget, a close eye on the top savings account deals, a regular review of your savings account and reading the small print, you could be on your way to saving yourself hundreds.