In order to build that nest egg for the future, you’ll need to start saving to generate some cash. Here are six strategies for developing the habit.
A. Pay off your debt
The smart way to start saving is to clear your debts first. Think a moment- if you have a credit card debt, you are paying high interest rates on it. Commit yourself to paying off a set amount each month. Then, when the debt has gone, put the money you would have paid in interest each month into a regular plan.
B. Save thing
Make small daily savings. They soon mount up. Put spare a change into a jar; take a packed lunch; cut down on those expensive cappuccinos – or those cigarettes. At the end of the month, you’ll have a small sum to put into a savings plan.
C. Put windfalls to work
Perhaps you worked overtime recently, received a tax refund, a bonus or a small inheritance? It’s not part of your regular income- so you won’t miss it if you save it.
D. Sign up at work
If your employer puts money into the company pension scheme, join it. Many people have stopped paying into company schemes, fearing that their money may not be sure.
Alternatively, pay into your own pension through a stakeholder scheme. Charges are low and you often can’t touch the money until you reach a set age- so there’s no temptation to spend it now. And there is tax relief on everything you pay in.
E. Get automated
However you decide to save, the best way to make sure you do it is to have it done automatically. Set up a standing order, which puts payments straight into a pension, mortgage, stock market investment or savings account. You will miss the money less- it just becomes another regular bill. The only difference is you’re paying it to yourself!
F. Overpay
You are already making a regular mortgage payment, so why not write a slightly larger cheque? It can be as good as saving- it means you will own your home more quickly and end up paying much less interest.
One good tip is to look back at what you were paying when interest rates were higher. They pay that much now.
A. Pay off your debt
The smart way to start saving is to clear your debts first. Think a moment- if you have a credit card debt, you are paying high interest rates on it. Commit yourself to paying off a set amount each month. Then, when the debt has gone, put the money you would have paid in interest each month into a regular plan.
B. Save thing
Make small daily savings. They soon mount up. Put spare a change into a jar; take a packed lunch; cut down on those expensive cappuccinos – or those cigarettes. At the end of the month, you’ll have a small sum to put into a savings plan.
C. Put windfalls to work
Perhaps you worked overtime recently, received a tax refund, a bonus or a small inheritance? It’s not part of your regular income- so you won’t miss it if you save it.
D. Sign up at work
If your employer puts money into the company pension scheme, join it. Many people have stopped paying into company schemes, fearing that their money may not be sure.
Alternatively, pay into your own pension through a stakeholder scheme. Charges are low and you often can’t touch the money until you reach a set age- so there’s no temptation to spend it now. And there is tax relief on everything you pay in.
E. Get automated
However you decide to save, the best way to make sure you do it is to have it done automatically. Set up a standing order, which puts payments straight into a pension, mortgage, stock market investment or savings account. You will miss the money less- it just becomes another regular bill. The only difference is you’re paying it to yourself!
F. Overpay
You are already making a regular mortgage payment, so why not write a slightly larger cheque? It can be as good as saving- it means you will own your home more quickly and end up paying much less interest.
One good tip is to look back at what you were paying when interest rates were higher. They pay that much now.
