As of today, more of your savings are protected as the Financial Services Compensation Scheme (FSCS) increased the protection level by £10,000 to £85,000.
For many, having this amount put aside is unrealistic, but even having some savings can keep you safe from unexpected bills and income shocks.
So what can you do to start putting some money aside and make sure it’s safe?
Get into the savings habit
The first thing to do is figure out how much you can afford to save every month, or what savings goal you would like to reach.
If you have no money left over at the end of the month you will need to look into areas you can cut back, or save money by switching energy, broadband or phone provider.
You could also try the jam jar approach, where any leftover change goes into a savings jar and is built up over time.
A useful trick is to treat regular saving as another expense. This way you won’t see it as a burden on your finances.
What to do with the money
Once you have some savings put aside, you need to think about where to keep it.
Banks and building societies offer a number of options from basic savings accounts to ISAs. All of these are covered by the FSCS, so you know your money is protected, even if the back goes bust.
This is better than just putting the money under your mattress – and you could earn some interest on your money too.
Investments like stocks and shares involve risk and are not covered by the FSCS, so you might not get all your money back.
However, there are a range of investment options where your money is protected, for example Premium and savings bonds from National Savings and Investments.
You might not earn as much from these as with other investments, but your money will be safe.