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How to save money

Knowing where to start when you want to save money can feel daunting, but it doesn’t need to be. With a few small changes to the way you manage your money, you can create a clear path forward to get where you want to be financially.

Here are some steps to get you started.

1. Open a savings account

Savings accounts can be a smart way to store your money and make it grow. As well as removing the temptation to spend any funds left in your current account, savings accounts enable you to earn interest on your money over time. 

2. Create savings goals

Whether it’s for a purchase, an event, or peace of mind, having a specific goal to save towards can help you stay focused. Decide how much money you want to save and how soon you need to save it, then work out a realistic plan on how you can achieve this.

You may want to try writing down your savings goals and placing them somewhere visible like the fridge or even create a note in your phone. This can help your targets stay at the forefront of your mind.

3. Pay yourself first

Prioritising your saving is important for staying on track. When your salary is paid, try to pay money into your savings account first. If you’re saving the same amount each month, you can set up a standing order so you don’t forget to move your money. 

4. Save while you spend through apps

Whenever you buy something, round up the amount you’ve spent to the nearest pound and add those extra few pence to your savings pot. It’s an easy way to keep your savings growing while having little impact on your day-to-day spending.

There are apps you can use to do this for you automatically, so you won’t even notice the money being moved. 

5. Keep saving

Experts recommend having around three months of your salary saved to cover you should something unexpected happen.1 But once you’ve saved this, you don’t need to stop. You could also consider moving savings into an ISA (Individual Savings Account) to make the most of any extra benefits, such as tax-free interest. 

If you need help working out how much you can save, use our guide on how to create a budget. You’ll be able to see where your money is currently being spent and where you can make changes so you can save more. 

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