Yorkshire Building Society has said that Britons are facing a multibillion savings shortfall, despite people saving more during the pandemic.
Apparently, the shortfall between actual savings and the amount needed to feel financially secure comes to £371bn.
It’s based on a poll of 2,000 UK adults.
I’m happy to send a SettleUp link if anyone wants to make a donation to my savings pot
But seriously, how good are you at saving? Any hints, tips or tricks?
I’m not actually saving anything at all indeed I haven’t been saving anything since the savings rates crashed to such pitiful levels as to not even make it worth my while bothering.
Our overall expenditure has crashed since the start of the pandemic, indeed we’re far better off now financially than before Covid started!
I clicked to find a figure of what they think makes people secure. I was expecting a couple of grand.
The bank’s polling of 2,000 people suggests UK adults require a “nest egg” of £17,465 to feel secure financially.
To me, that’s a huge number! I’m luckily employed and I have enough of a safety net that if I have a problem with my car/boiler/washing machine, then I’m not going to be starting a GoFundMe. But beyond that? Not much. Maybe more than some, but I’m sure less than others.
But £17k just seems like people wishing they had a deposit.
For me, it started with setting an arbitrary emergency pot threshold – let’s say £15k (just an example, but I’d say 3/6/12 months’ necessities are usual), then putting £500 a month into it, and simply cutting out most luxuries until full.
Then cut that down to £100 a month to continue building up my “nest egg” while putting the rest towards short term goals or nice to haves
Bit hard at times but lockdown really helped, and I’m on track to finish stage 1 by the end of the year
Okay at it.
Would recommend turning savings into investments as on the longer term your ISA is going to outperform, like even on a period of a year with the tech giants.
Aside from that, a bank deposit that is like, maybe 6 months expenses? Incl rent and regular spending.
Would use YNAB and cut down where possible, but a really good tip is trying to purchase services as a foreign resident. For example YouTube Premium (India) is £1 a month or so and comes with everything you want music wise.
Until Google find out and ban you from their services without access to your emails, photos and more
Saving £11 per month on YouTube Premium will get you to £17k in 118 years.
You could get there slightly quicker by not paying £1 though.
Got any other tips?
The “nest egg” in the article seems to mean cash savings, which makes the £17k+ figure seem pretty high. If they mean cash savings alongside investments and pension topups and whatever else, the people of this country are much wealthier than I thought.
Thank goodness I ditched Google Gmail!
YMMV, they’ve never seemed to care about any of it in general. Especially considering I’m using a business account it’s feasible that it’s an Indian subsidiary using it, I guess
Every little helps. Shop own brand stuff, cut out meat, YouTube Premium it in India, swap to drinking water only or some cheaper Earl grey. Invest in tools where the CapEx pays itself off in the length of time it lasts (for example a good pen will let your lifetime, same with a good wallet, same with a good pair of shoes and same with a good bag)
Also, take the money you save and invest it.
Most people do not set aside a solitary pound month to month.
It’s largely caused by dealing with all of their money from one account. Or, using a linked saver only.
People need to built a bit of savings habit traction first before moving to investments.
A realistic month to month budget and a place to built up money seperated from any debit card or current account function is where most need to start.
Ditching Gmail is very much on my to do list
Sounds like a fun existence.
Sadly, like making a will, always there in the back of one’s mind, but never gets done.
I’ve been with Protonmail now for almost 2 years, much better than Gmail in my opinion. Yes, I choose to pay for Protonmail, but it’s cheaper buying a 2 year subscription (see, saving!) plus it’s also savvy to choose which currency to pay in, so currently paying via my Starling debit card in US Dollars, is cheaper than paying in Euros or Swiss Francs.
As far as other ‘savings’ are concerned, well I’m ok with most supermarket own brands. I don’t holiday in the UK because it’s far too expensive and in any case, I live in a very nice part of the South West where loads of people pay huge amounts of money to stay for a week when outside of Covid, me and the Wife can go to Dubai for an all inclusive for less than a week in some parts of the U.K.
As for investing etc, I’ll leave that for the people who have literally thousands in spare cash to put away for as long as they can keep it tucked away for. It’s ok saving all that cash or tying it up in investments, but if Covid kills you, it’s not much use, so I’m all for spending my money when I need to. Cheery soul aint I?
Someone I know also does this, but forgot the reasons as to why.
What are the main benefits over the free package?
This explains it better than I ever could:
I don’t have savings in the traditional sense but because I use ynab I always have a large amount sitting in my bank account waiting to do something in the future.
I’m prepared to do my bit, but I doubt it will make much of a dent in £371bn
Savings organisation states that we need more savings shocka !
People might even consider it if they got more than 0.5% interest…