It’s a tough time to save money, but you may still need to save up. You might know that you will need to replace something expensive, like a car or washing machine in the near future. You might be saving for a life goal like a wedding or to put a deposit on your first home. Whatever your goals, knowing how to stick to your savings targets is key to success.
According to new research commissioned by HSBC, only just over one third of people (36%) in Britain have set a savings target – but setting a target can help you focus. Work out how much your goal will cost you – now is time to scan the ads for the car or washing machine, or cost up the wedding. While this can be daunting, being in control of the facts can help.
Once you have your target, you need to look at your budget – read more about how to budget here. Even if you only have a small amount spare each month, this can kick start your savings. What’s more, knowing that you have a goal can help inspire you to say no to unnecessary expenditure. It’s easier to walk past the coffee shop or leave the lipstick on the shelf knowing that gets you one step closer to your dream.
Cash savings are by far the most popular way to plan for the future with more than half (53%) using that as a way to put money aside, followed by pensions (31%), and shares at 16%. You can get higher interest rates on accounts that tie you in for a period such as a year or more – but make sure this ties into your savings goal. Look for regular saver accounts too – you get extra interest if you manage to put in a certain amount of money each month so these are good if you know you can stick to your savings goals.
According to the HSBC survey, more than half (55%) of adults age 25-34 are saving towards a specific target. But despite this, they are the most likely to have to dip into their savings because of overspending – so bear that in mind when you are browsing the internet and stay away from online shopping as a leisure activity.
Overall, almost 4 in 10 (39%) of people in Britain say they have managed to reach a savings target – with the most common reasons among those who failed to do so being:
- An unexpected life event (40%)
- Dipping into savings to make up for overspending (29%)
- Setting a goal that was too high (10%)
Make sure your goal is realistic – there’s a fine line between working hard towards a target and making your life miserable. If you do overspend one month, be kind to yourself. Notice the situation you were in when you overspent. Were you tired? Had you been drinking? Were you feeling down? We often spend money to make ourselves feel better, and being aware of your weak point can help you avoid the pitfall next time.
More men (35%) than women (26%) say they’re saving money into a pension, and they’re also nearly twice as likely to be investing in shares (21%), (12%) and investment funds (12%), (6%). If you don’t have a pension, think about starting one sooner rather than later as the longer you put money in for, the more chance it has to grow. Thinking about your longer time savings goals while planning for the short and medium term can help you safeguard your future.
Lisa Gallagher, Senior Savings Product Manager at HSBC, says the survey highlights one of the key changes you can make in the way you manage your money that can help you create a clear path forward to where you want to be financially.
“This new research reminds us all that setting a target, regardless of our age or where we live, is a key step towards achieving a financial goal and it’s great to see younger people and women leading the way.”
“HSBC UK is to proud help customers improve their financial health through our Financial Fitness Hub and by providing a range of Savings and Investment products that support both short term and long term savings goals.”
Read more about this survey and find tips on how to save your money here: https://www.hsbc.co.uk/savings/how-to-stick-to-your-savings-goals/
All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2002 adults. Fieldwork was undertaken between 17th-20th September 2021. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).