Top tips for saving in this new financial year
Every April marks the start of a new financial year, and there are plenty of good reasons to use this as a time to start making some savings.
If you’re self-employed, it’s usually the start of a new tax year, which means any efforts you make to save and to earn more will help you to file some healthier looking accounts in 12 months’ time.
Even if you’re not directly affected by the tax year in a business sense, consumer saving products like ISAs are also aligned with the financial year, which means you’ve got a whole new tax-free savings allowance to make use of.
Here are some ways we could all save money better in the coming 12 months.
However you choose to save, do it regularly. Even small amounts set aside regularly will build up to large amounts over time.
An ARRO Personal Account can be a convenient way to keep money to one side in a secondary account. We offer fee structures with no monthly management fee, and there’s no charge on deposits – ideal for long-term saving where you trickle small amounts into the account.
Cash or card?
Rather than paying for everything on card, consider making cash withdrawals instead. Often it’s easier to realise how much you’re spending when you have to physically hand over the cash.
You can keep loose change in a jar as a kind of grown-up piggy bank, and raid it to cover small costs like bus fares or an ice cream in the park, at times when your current account is looking bare.
Pay off debt
Most forms of debt will charge you more in interest than most savings accounts will pay, so do the sums and decide what’s worth paying off before you start to actually save a positive amount.
Remember to leave yourself enough for a rainy day – there’s no point paying off your mortgage if you’ll need a payday loan to cover the electricity bill for the month.
Maximise your income
The more you earn, the more you can save. If you’re really serious about putting more money in the pot, ask about promotion or paid overtime opportunities at work, or even consider a second job or self-employed income stream.
Again, it’s all about striking the right balance, so don’t run yourself into the ground for the sake of a slightly better-looking savings account, but it’s worth considering.
Don’t dismiss them until you try them! If you’ve been buying the most expensive brand of a particular product for many years, it might be time to give own-brands a try instead.
You probably won’t like everything you try, but even just a few own-brand substitutions in your weekly shop can help to cut the cost of running your household, especially if you have kids.
Pay by Direct Debit
There are several good reasons why paying by Direct Debit can actually save you money. Many suppliers offer a discount for this, or specific tariffs on energy supplies.
But it also makes sure you pay on time, which means no overdue fees or red bills coming through your door – which helps you to live with peace of mind as well as a few more pounds in your savings account.
This is not about saving more, but about the way you save. Think about what you will use the money for – is it for a rainy day or a last-minute holiday booking? Will you be able to give 14 days’ notice when you want to make a withdrawal?
While tax-free ISAs and high-interest savings accounts can help to increase the amount you save, there is often a trade-off. If you just want a secondary account to save some money with instant access and low fees, you can set up an ARRO Personal Account in just three minutes and start moving money into it.
One account to do it all
If you want to save tax-free, ISAs are the way to go. If you just want a safe place to put some of your money until you’re ready to spend it, an ARRO Personal Account could be a good option.
There’s no interest paid on an ARRO Personal Account, so you don’t pay any tax – whatever you deposit is there for you to withdraw at a later date.
There’s no debt either. No credit card or overdraft, so again, it’s a safe place to keep a positive account balance as a separate space for your savings.
And when you need your money, you can transfer it out via Faster Payments, pay for things with your MasterCard® debit card, or withdraw cash from an ATM – so you’re always in control of how and when you spend your savings.