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Is your savings buffer big enough?

What would you do if your washing machine broke down? Or what if you lost your job?

These are never questions we want to think about and it is easy to brush savings worries under the carpet. But it’s important to try to get a buffer together for life’s curveballs.

According to a report from the Social Market Foundation, 26-35 year olds have on average less than one week’s worth of income in savings compared to four weeks across the rest of the population. The amount this age group has in savings has also fallen by 36% between 2005 and 2012-13.

If this sounds like you, read on for some ideas on how to make saving easier.

How to start saving successfully

The first step to successful saving is to consider what you are saving for – do you have a particular goal in mind, or is a buffer your aim? Thinking of the amount you’d like to save, and writing it down, will help focus you.

Next, work out how much you can afford to save per month. Is there anywhere you can cut back?

 

It’s also a good idea to set up a standing order to transfer the money each month into your bank account. If you set it up on payday, it will make it easier to adjust to the money not being there.

Shop around for your savings account

Are your savings working as hard as you are?

Comparison websites are a good starting point for anyone trying to find a savings account tailored to their needs.

The type of account that will work best for you will depend on how hands on you are prepared to be with your savings and how long you have before you need to reach your goal.

 

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  • Shirley davies / 30 July 2015

    Have always saved and still do to an extent although age tells me not to bother too much. Times used to be ha rd when I was young but rates for saving were so very encouraging that you could really see t he increase in pennies to pounds. Now the rate alone deters the majority.