By Alperen Acik, Savings Policy Analyst, Building Societies Association
Coconut milk and freedom
Every time I’m on the way to work, I pick up an iced vanilla matcha latte with coconut milk – trust me the coconut milk is crucial. It’s a small treat for going into the office. Slowly those £4.50s add up, in the same way that £10 or £20 set aside each week does. When saving and spending feel balanced, little treats feel guilt-free. They feel earned.
Otherwise, I begin to question whether I “really, really” need my sweet, energising cold beverage of choice in the morning. That’s what saving is to me, more confidence and much less worry. In a way it’s freedom, freedom to enjoy little treats and to say yes to some bigger things too.
Spend-and-save
Good financial habits like regular saving provide the confidence to make financial decisions with a little more certainty. The internet is full of inspiration for how we should live, dress, travel and spend, but far less attention is given to the habits that help pay for it all. The two are not mutually exclusive!
Saving isn’t always about preparing for a distant goal. Sometimes it’s simply about having options. Being able to say yes to dinner with friends, cover an unexpected expense or book a last-minute train without immediately worrying about the impact on your bank balance can make a real difference to how you feel about money day to day.
Other young adults tend to agree. Our recent research for UK Savings Week, carried out by Opinium, reveals that more than half (51%) of 18 to 34-year-old savers say their saving habits have boosted their confidence in dealing with other areas of their finances. So, starting to save can feel like a first step in taking charge of your finances.
Making money work
But the more startling finding from our research was that among the same age group, nearly two thirds (61%) are with their first bank or building society. While shopping around and switching your account for a better rate on your savings is a smart financial decision, 36% say they never check their savings’ interest rate and 34% never compare rates! But it’s never too late to look for better deals, so if you haven’t checked recently, I’d encourage taking a quick look at comparison sites.
When bills, rent and essentials are so expensive, having spare money to set aside is a lot of hard work. So, if you’re already saving you’ve done the hard bit! Now it’s all about making sure your money is working as hard as you did to save it. Try not to keep most savings in a current account where your money may earn little or no interest, which is what 38% say they do.
If you ask me, it’s kinda chic to have a savings account, a good one. It gives your money somewhere to grow, gives you greater freedom to enjoy it, and it gives you chilled coconut matchas when you need one.
