Ideas for building savings pot

[HRNewins]

I find the most terrifying thing about starting a family is making sure we have enough of a financial cushion to pay for all those unexpected things life can throw at you. How does everyone else go about building up their savings?

My partner and I have a budget drawn up and we pay a certain amount into our joint account every month (we both earn a similar wage). This amount is all of our bills + a few extra hundred pounds. The bills all come out of this account, with the idea being that over time we build up our savings. But it doesn't seem to build up too quickly!

We also use an old school piggy bank- I put any £2 coins I have laying around in there- I have no idea how much is in there and don't want to break it lol.

Lately I've started using the Plum app via Facebook. I found it via a recommendation on MoneySavingExpert- I was a bit dubious at first but read into it and it's trustworthy. It links safely to your bank account and deducts small amounts that you won't notice over time via a direct debit. I've saved an additional £200 since November via Plum which is helpful. The link is here if anyone wants to check it out: friends.withplum.com/r/aBMLSi

I've thought about getting a second job but at the moment it would leave me with very little downtime alongside my current job. Plus there doesn't seem to be very many opportunities in my area.

Would love to find out if anyone else has any helpful tips and tricks for being a bit better with money! I'd love to look into investing but it all seems quite high risk and I don't really know enough about it.

Any thoughts much appreciated .

The ‘rounding down’ thing works quite well for me. So if I check my account balance and it is, for example, £139.26, I transfer £9.26 into my savings account. If you are able to do this a few times a month I find it adds up nicely by Christmas.

When I was younger, I used to work on top of my full time job. When I got my first flat, I rented the spare bedroom to generate extra money. I also lived frugally (spent little on going out or clothes, used public transport, shopped in Asda or Lidl etc). That all added up really nicely over the years.

On the investment front, there is some risk but there is also more to gain. If you’d rather not do that yourself, you can just concentrate on putting a good amount into your pension, overpaying the mortgage etc - that will also allow you to build up wealth without being all that investment savvy.

Plum say that money with them is possibly safer than with a bank.

Use a bank rather than a phone and you'll get a bit of interest. Play the switching game and you'll get £100 or more here and there. Don't keep cash in piggy banks, you are not 12.

Spend less, forget tatmas, hammer down bills. Do real things.

Do all the other things that Moneysavingexpert suggests, including putting together a workable budget, minimising all your expenses and remember their money maxim every time you buy something - do I need it, is it worth it, have I got the best price etc.

Think before you spend especially if either of you are prone to buy lots of food and drink out of the house when you could take a packed lunch, or buy clothes when you have loads already.

Play with the demotivator to work out the annual cost of a daily coffee or bought lunch, or anything else that seems cheap as a one off, but adds up to loads if you do it regularly.

Think of your savings in two parts, one for irregular expenses like car insurance, white goods replacement, Christmas etc - these will happen and will be one reason why your savings aren't building up. And then separate savings to cover maternity leave and baby expenses.

Put some savings aside in a separate account when you get paid, if you are prone to seeing money in your current account as available to spend. Lots of banks do fixed regular savings accounts - say £200 pm for a year with 5% interest. If you're hoping to have a baby in the next few years, forget about investing, if the stock market goes down when you need the money, you'll lose out.

Make sure your partner is also on board with the savings plan and not leaking money too - it's a team effort!

Treat savings as another bill - transfer a certain amount at the beginning of the month rather than hope it’s there at the end.

Is your plum link a referral one by the way? No problem with you doing that but it’s polite to tell people that’s what you’re doing.

Keep an account of absolutely everything you spend in a day, over a week or two, you often find where you might be wasting money I.e. magazines you don’t reallt need, too many shop bought lattes etc.

Really don’t agree about not using a piggy bank. I saved up several hundred pounds to put towards a car by saving my £2 coins into one. Yes in an ideal world it would be better to put them straight into a savings account, but it’s much easier and quite satisfying to slot them into a money box when you find them in your purse/raid DHs pockets. I used to bank them when it was half full though.

And if you get burgled it is all gone, won't be insured. Plus it can earn a bit of interest in the grown up bank.

Get an actual savings account to put the spare £100 in, have a look round, Nationwide have a savings account paying 5% if you have your current account with them.

Use your ISA allowance.

I buy almost everything online and use top cash back, the cash back goes into a savings account.

have a look at the cost of childcare and that will tell you the minimum you need (unless one of you is going to be a SAHP or your family will do childcare).

One of my neighbours collects £ coins, just the ones with the dragon on. They go in a different pocket if she has them in change, it's a small amount but an easy idea.

I save up coins and bag them up, I use them to pay for my nails doping so it doesn't feel like they cost me anything.

^The link is here if anyone wants to check it out: friends.withplum.com/r/aBMLSi^

The main link is withplum.com/
OP has posted a referral link that gets her £25 for every 3 signups on her link. Bit bad form not to be upfront about that!

The two things that have been key to us building up a savings pot have been:

1. Paying savings first - so putting money aside on payday into a savings account. We have a separate emergency fund/long term savings pot as well as pots for things like Christmas/ holidays/car insurance etc etc.

1. Whenever we get any extra money (bonus, pay rise, council tax free month etc) we always put some into savings - the % depends on how much the actual sum is, but for something like a one off bonus we'd put 50% in long term savings, and 50% divided across things like holidays, treats etc. Anything a bit more long term like a pay rise would get divided up three ways - one part to increased pension, one to savings, and one to better living standards now.