Saving tips for 2012
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Our top 10 tips for saving efficiently


Wanna save money? Ditch the chauffeur and take the bus
Wanna save money? Ditch the chauffeur and take the bus
We asked two different financial experts, Frederic Nze, CEO of Oakam and Jane Heyman, chartered financial planner at McCarthy Taylor, to give us there top tips on how to save money efficiently.

1. "Shop around to find a savings account with a high interest rate"
Frederic Nze, CEO of Oakam -  the established retail financial services provider serving the UK’s unbanked and underbanked communities - advises carefully researching your savings account options before committing.

Money comparison sites can often show you what deals are available but it's wise to also contact your chosen providers directly and make sure you understand any restrictions or obligations correctly.

2. "If you are not strong willed or disciplined with money, use a regular savings account"
advises Jane Heyman, chartered financial planner at McCarthy Taylor. Regular savings accounts mean you cannot touch the money for a period of time without a penalty. She also suggests a postal account that makes access more difficult to access your funds for an impulse purchase.

3. "Use tax efficient savings such as ISAs first."
Heyman insists that whatever type of savings account you go for, you should first take advantage of tax-free ISAs. If we pay UK income tax on basic rate or above then we're also expected to pay tax on the interest we make on our savings!

However we get £5,340 tax free savings allowence for cash and if we have shares it's up to £10,680. This means that an ISA is almost always going to be the 

4. "Place a certain amount of money in your savings as soon as you get paid"
Nze says this will help you budget for the rest of the month.

5. "Do a budget and stick to it"
Heyman says planning is essential.
  • Start by working out how much you bring home each money.
  • Then allocate what you need for non variable essentials: Rent or mortgage, debt repayments, etc.
  • Then tackle phone bills, gas, electricity, water, TV, internet, travel. Can you save on any of these? Can you get better deals?
  • With what's left you can then allocate what you need for food, household products, clothes and other essentials. Heer's where you can make significant savings and where you'll have to work hardest to stick with it.
  • The remainder is for savings, higher debt repayments, entertainment and luxuries. Focus on the first two before considering the second.
6. "Keep track of everything you buy and eliminate those items that you do not need."
Nze advises that you should try to resist buying unnecessary luxury items if you are saving for something important, such as a deposit for a house. That morning coffee, that mid-afternoon snack, that round of drinks - it's all got to go.

7. "Choose cheaper alternatives when shopping."
Even if you don't go to the cheapest shop-brand items, just taking one step down in price will save you cash.

If you want to ensure you're making the most of your budget, Nze says to "always look out for offers and vouchers if you want to treat yourself. You can place the money that you save in your savings account."

8. "If you have any surplus income, reduce debts or put away into a savings account."
Heyman also advocates putting away or paying off before spending cash on luxuries. McCarthy Taylor recommend that we have a minimum of 3 months expenditure in savings - that means we could carry on as normal for three months if we were to lose our jobs.

9. "A good tactic is to open two different bank accounts"
Nze suggests having one account for essentials and direct debits e.g. rent, etc. and one for luxuries e.g. socializing, clothes.

10. "Set yourself an objective and keep a picture on the fridge door of what you are saving for"
Heyman suggests cutting out a picture of your dream house or holiday destination and sticking it to the fridge to remind you to keep saving!


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Article Plan Saving tips for 2012
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