One of the attractions of an easy-access savings account is its versatility. So, if you’re not already doing so, why not consider using the following ways to ensure your savings work as hard as possible?
Build a Safety Net
Money experts generally encourage savers to set aside three to six months’ worth of living expenses as an emergency fund, with ‘expenses’ defined as essentials such as rent and groceries as opposed to optional expenditure such as travel or meals out. Then, in the event of an emergency or unexpected expense you will have the funds readably available.
But while this makes sense, it might seem a big target number to many of us, particularly in the middle of a cost-of-living crisis. It’s also the case that you may want to consider a smaller emergency fund if you are paying off debt. The good news is that if you currently save relatively little – say £200 to £400, every additional £ saved will make a big contribution to your financial resilience. So, saving regularly towards a more modest target, for example £2,000, may be more realistic.
Set up savings goals
Setting clear savings goals has been shown to help savers to both reach savings targets faster and to save more in total. In fact, recent research* found that people setting clear goals increase their savings by as much as 73%. The best way to do this is to name the goal, for example ‘Spanish holiday fund’. Then picture yourself benefiting from what you’re saving for, for example swimming in the sea. It might just provide you with the extra motivation to cut down on some of your expenditure and boost the amount you save regularly. Use the savings goals tool in the Transave app to create multiple savings goals and then monitor and progress towards each one with the aid of useful graphics plus automated updates and reminders. To set up your savings goals you will need to log onto your account through the website or app, be saving regularly with us and have no outstanding loans with Transave.
Create a Budget and manage cashflow
Creating a budget will create a strong foundation for your finances and allow you to manage your money, control spending, save more money and stay out of debt. Let’s face it without an accurate picture of what’s coming in and going out of your bank account it’s going to be impossible to manage your finances properly. And with an easy-access savings account you can make unlimited withdrawals with no fees or charges. So, when you track your actual spending against your budget and find you need a few extra £’s it’s easy top up your budget from your savings account. On the other hand, if you find you have some spare cash available, you could make a lump sum deposit back into your savings account.
Of course, it’s ultimately up to you how you use your savings account. But using one or a combination of the above methods should help to make saving regularly an even more rewarding experience.