New year, new you? Once the festive food and drink indulgence has worn off, January 1st brings an opportunity to refocus on improvements for the year ahead. And with the ongoing cost of living crisis in the UK, one area many people will be focusing on this time is savings.
Having money aside can come in handy in a range of ways throughout life, from achieving milestones to dealing with disasters. But over a third of UK adults have no savings or less than £1,000 – risking coming up short when they need it.
Savings goals are a great way to make a positive change and start saving with purpose. Having specific targets in mind can give you extra motivation and confidence in your financial decisions, with a clear payoff at the end to make it all worth it.
So how can you create great savings goals and stick to them?
Focus on your savings priorities
Firstly, savings goals only work if they’re relevant to you – so start by identifying your top priorities for the year ahead. That might be saving for a house deposit or new car or building an emergency fund just in case.
You can have multiple goals at once and include a mix of short and long-term priorities – but having one or two key focuses will probably be easier to manage.
Work out how much you need to save
Next you’ll want to work out how much you need to save and by when, then what that looks like on a monthly basis.
This is where having a solid budget comes in handy. Tracking what’s coming in and going out will help you understand what you can realistically save each month – plus any areas you might be able to cut back in to achieve it, such as travel or food.
Find the right place for your money
Storing your savings in the same account as your everyday spending money can get confusing. It’s better to open a dedicated savings account to and move savings across when you can, keeping things separate while earning interest too.
There are a range of savings accounts out there with different rates and access terms, so it’s worth comparing the key features to find one that works for you.
Track your progress
Sticking to savings goals is easier said than done. But many banks and apps allow you to track how you’re getting on with visual progress updates and notifications, which can be the motivation you need to make it all the way.
Another easy way to keep things going is to set up automatic payments into your savings account, reducing the risk of you forgetting or ignoring them.
Do you have clear savings goals in mind for 2024?