Like it or not, we’re all in a relationship with money.
For some people, money runs through their fingers like water, while others grip it tightly in their fists. Some people fret about their finances, others bury their head in the sand and emerge only when they need to work out how to make a tin of beans last for the week before payday (hello).
The key to cash confidence, however, is feeling like you’re the one in control. That feeling of control? It comes from knowing how to save, and knowing that your money’s safe.
As for your money being safe, rest easy; any money you put in your current or savings account is automatically protected by the Financial Services Compensation Scheme (FSCS), which was set up by the government and protects your money up to £85,000. So you can’t see it but you know it’s got your back.
As for the saving, well, that requires a little more input from your side. But if you’re clever, there are loads of easy ways to save money which don’t involve starving yourself or staying at home with the lights off.
Simple everyday changes are where it’s at, from switching your bank and rip-off energy supplier to making the most of holiday hacks. Here are the easiest ways to make big changes.
What’s The Right Bank For Me?
Most of us opened our first account as teenagers with the bank our parents frogmarched us into. Chances are, you’re still with that bank and it’s doing nothing for you. Some banks on the high street pay as little as 0.05% interest. In real terms that means if you had £1,000 saved, you’d earn 5p interest which is, quite frankly, a joke.
If that’s the case, it’s time to dump your bank and find one that deserves you.
Nationwide offers a high 5% interest on balances up to £2,500 for a year so you’d get up to £125 by the end of the year. To get this, however, you would need to pay £1,000 a month into the account.
If you’ve got cash to stash you could earn 1.5% interest on £20,000 with Santander’s 123 account plus up to 3% cashback on household bills. This would add up to an extra £300 a year plus whatever you make on your bills. All you’ve got to do is set up two direct debits and pay in £500 a month. There is however a monthly fee of £5, which will put a bit of a dent in your earnings.
Nationwide, First Direct and M&S Bank all offer regular savings accounts which also pay 5% but you’re usually limited to monthly deposits of £250-£300, which you can pay in for a year. These are great for getting into the savings habit.
Other providers, such as HSBC, offer current account-switching bonuses of up to £200 and it shouldn’t be too much hassle to make the change. The Current Account Switching Service (CASS), an industry-wide initiative, makes it easy. Just pick the current account you want to switch to and ask your new bank or building society to switch using CASS. All your direct debits, standing orders and planned payments will be transferred within seven working days. Magic.
Prefer to manage your money on your phone? Monzo and Starling Bank are banking apps that can be downloaded within minutes for super easy money management and both are protected by FSCS.