Putting money aside doesn’t have to be a chore. Take a look at these tips on how to save money every month and you’ll soon be on your way to a nice nest egg.
You’re probably thinking that you don’t earn enough to save money each month. And you’re not alone – 1 in 4 of us have no savings at all.
Until a few years ago, I was in the same position. I would get to the end of the month and find I had nothing left. But there was always next month, or so I thought. But of course, I wouldn’t save then either.
However, little and often is a great way when it comes to saving money and there are various ways to go about it. Below, is a list of some ideas you might like to try.
One method people find useful to help them save is by setting themselves a challenge. Now, there are lots of saving challenges out there and some will be more suitable for you compared to others.
The good thing is, all you need to get started is a jar or a moneybox. And a bit of willpower.
The £1 challenge
Fairly self-explanatory, everyday, you place £1 in to your jar. Then at the end of they year, you’ll be £365 (occasionally £366) richer. A possible decent start to your savings’ journey, but you will always need to have £1 handy.
The 1 pence challenge
Or, you could try the 1 pence challenge. You start by placing 1 pence into your savings pot and increase it by 1 pence every day. So, by day 30 you’ll be putting 30 pence in, day 31 – 31 pence and so on. This might not sound like much, but will actually earn you a staggering £667.95 in a year.
The downside to this is that you need to be organised and keep a spreadsheet for your savings. Plus, if you start in January, can you really afford to be saving £20 per week in the run-up to Christmas?
The 52 week challenge
Perhaps trying to remember to save each day might be a little much. Instead, you could try and save once a week instead. Take a look at how much you want to save over a year and then divide it by 52.
Then, set up a direct debit from your current account to a savings account. For example, £9.61saved each week will give you just over £500 at the end of the year. This is a good way to save but requires you to keep a close eye on your bank account. You don’t want to rack up charges for going overdrawn!
The punishment/bad habit jar
I’m sure most of us have something we shouldn’t do. And what if when we did that thing, we fined ourselves and placed the money into a jar? Well, this is a great way to save money and help to break bad habits. The only problem with this, is if you break the habit, you stop saving.
There’s an app for that
My favourite way to save money each month is by using technology. After all, why put in the effort when an app can do it for you?
The last couple of years has seen a real burst in the number of companies that can help you save through an app or Facebook Messenger. They are linked to your bank account and using clever algorithms, can calculate how much you can afford to save.
The money is then taken out of your current account and transferred to your savings account. These are usually small amounts, but you can stop them at any time if you want. And if you think you’re saving too much or too little, you can increase or decrease your saving levels.
My top pick at the moment is an app called Plum. At the moment you can only use the app through Apple, otherwise, Android users will have to use Messenger. Once your money has transferred over to Plum, you can leave it there for when you need it, or you can invest with the view of making more money. Please note that your money can be at risk if investing.
I love using Plum, but because you don’t receive interest, you should consider regularly
Or take a look at my more in-depth review of Plum and see how much I have made through investing.
Another app I use to help me save money is Chip. This app works in almost exactly the same way as Plum. However, the advantage to Chip is that you receive interest for keeping your money with them. This starts at 1%, but increases by another 1% for every friend you recommend (up to a maximum of 5%). So, Chip doesn’t have the potential to return quite so much money as Plum, but always gives you a steady amount of interest.
If you want to download the Chip app or just for more info, then visit here. It would be much appreciated if you could use my promo code RJWEGT so I could reach 5%!
Hopefully, the above has provided some ideas on how to save money every month. As I said above, little and often is a great way to start out when saving money.
And if you’re under 40, take a look at the Lifetime ISA which comes with a 25% bonus.
*Please note that this post contains affiliate links.