New year resolutions are created at the start of the year with this in mind “new year, new you”. However, by the end of January, most have been broken as they may not have been as realistic as you thought, or the timing wasn’t quite right.
Similarly, we have seen a growing trend of people trying to get into the habit of saving as one of their new year resolutions. It’s not an easy task to accomplish. However, we have a few ideas to help you get into the habit of saving money.
1. Set a goal of how much you would like to save by Christmas (just an example) by using a tool called SMART.
Specific – Think about how much you would like to save by Christmas.
Measurable – Determine how much you will save each month to reach your target amount.
Actions – Find ways to save money each month. You can read our blogs on money-saving tips; or perhaps open a savings account where you can put aside some money each month.
Realistic – make sure that the target amount that you have set for yourself is achievable. Create milestones and give yourself a little reward for reaching them. This will motivate you to continue saving.
Timely – there are two factors here:
- Reaching your target amount by the end of the year/occasion that you are saving up for
- Make sure that you have accounted for any major changes in your life that will take place in the year when you set your goal.
Tip: If you haven’t started saving yet, start by setting a small amount over a short period of time. Once achieved, increase the amount that you save each time you set a new goal.
2. If you are saving for a special occasion such as Christmas or holiday, you can open a savings account. At M for Money, we have a wide range of savings accounts to choose from with a reasonable interest rate. Find out more.
3. Pay yourself each month through the Payroll Deduction Scheme.
One of the most effective ways to start your saving habit is by ‘paying yourself first’. This means that you would have put a pre-determined amount of money aside each time you get paid before using any of that money for spending.
This way you are automatically saving money even without thinking about it.
Find out more about our Payroll Deduction Scheme here.
4. Create a budget of how much you will be saving each month. The Money Skills App has a good tool to help you. Learn more.
5. Making a purchasing decision? Whether it’s one that you have thought about or an impulsive one, think about what you are about to spend. A straightforward way is to think about how many hours you would need to work to afford the purchase that you are about to make.
For example, you earn £10 an hour, and the new pair of shoes that you want to buy is £50. You should think about whether that pair of shoes is worth five hours of your life.
Remember: Be a mindful consumer rather than a mindless one. By thinking about what you are about to spend (and if it’s worth it) is more step towards your habit of saving.
We wish you all the best with your habit of saving. Remember, you can always get in touch with us if you need help with saving your money.