Protecting Your Savings
When finances are stretched, savings can often be the first thing to suffer. Paying bills and putting food on the table is naturally a priority and many find there is simply not enough cash left over to save once they’ve taken care of the essentials.
In fact, statistics show that in 2012 a third of UK adults didn’t save at all, with one in nine people actually dipping into their savings to cover household expenses. So how can you ensure that your nest egg stays safe during difficult financial circumstances?
Why are savings being threatened?
Savings are being threatened on two fronts. Firstly, due to other financial demands, people are simply not depositing money in their savings accounts. And for those that still manage to, the amount they can spare is diminishing.
Secondly, more and more people are being forced to use their savings for day-today costs, with 53% of savers regularly accessing their savings throughout the year, and a third of savers using their accounts to cover unexpected outgoings such as emergency repairs or car maintenance.
Most consumers believe that they need at least two and a half months salary saved up for a rainy day but in reality, one in four has less than one months’ salary saved. Most Britons have less than two. This deficit could well lead to problems in the future. Ensuring your savings are protected has therefore never been more important.
Can changing bank accounts help?
A simple step that you can take to help you save money is to change your bank account. Although you may already have an account that’s right for you, with so many products on the market, shopping around is always a good idea.
Bank interest rates can vary widely, so ensure that you get the best rate possible on your account. If you’re using your overdraft on a regular basis, switching to an account with a larger overdraft facility could save you valuable pennies.
Open an ISA Savings Account Today
A popular method of saving is to open an ISA. Like current accounts, the interest you receive on an ISA will vary from bank to bank with the best rates ranging from 1.4% to 2.5% according to This is Money.
If you don’t need access to your money for a while, or want to make it less accessible so it can’t be spent as easily, a fixed term ISA could be the solution. Offering better interest rates than standard ISAs, you have to commit to saving your money for anything from one to five years.
Set up a direct debit
If you have a dedicated savings account or more than one current account, setting up a direct debit between bank accounts can help you put away a little every month.
As direct debits leave your account automatically, you don’t have to make a conscious decision to save the money and once it’s left your account, you can hopefully make do without it. Although you may not save huge amounts this way, it can stop your savings becoming too depleted and give you a bit more of a cushion for a rainy day.