Why it’s important to continue your lockdown saving habits to strengthen your financial future

As the nation enters a second lockdown, we’re again reminded how difficult 2020 continues to be. Positives have been few and far between but for many, we have at least managed to take stock and evaluate what the important things in our lives are.

This includes ensuring we have enough money to enjoy life, having enough set aside for the rainy days and, in the long term, making sure we have the financial security to protect and provide for our loved ones.

This inevitably involves saving. It goes without saying that, in the midst of an unprecedented global pandemic, this can be easier said than done and with increased unemployment, the extension of furlough and current uncertainty it is clear that everybody’s circumstances are different.

However, with the right guidance and approach, personal finance can be simplified and an effective strategy for savings – no matter how small – can be achieved. And as the old adage goes, look after the pennies and the pounds will look after themselves.

Here’s are a few tried-and-tested saving habits that, when adopted in these uncertain times, can pave the way to a prosperous future:

Have a budget – and stick to it

It sounds simple but often the simplest concepts are the most effective. By budgeting you should be able to work out how much you can save a month. It’s important to be honest and realistic about your outgoings and also a good idea to build in a contingency element to your budget so any unexpected surprises during the month can be absorbed into your budget.

Have a goal to aspire to

We all know it is good to save but working towards something – be that the deposit for a house, a new car, that dream holiday or even money for your children’s education – can give you that added motivation to succeed in your saving; knowing you are working towards something and that your saving will help you achieve this.

Chip away at outstanding debts

While seeing money gradually flowing into your savings account is a nice feeling, it’s also worth chipping away at any outstanding debts, loans or money on your credit card. Not only will this offer you more peace of mind and a sense of freedom, the money you subsequently save on interest will offer greater gains and financial certainty in the future.

Diversify your financial portfolio

Traditionally, savers are rewarded for putting money aside by way of interest payments. However with interest rates historically low, it is worth talking to a financial adviser about how you can maximise your hard-earned savings to make them work as hard as possible for you. That may involve several investment options, from ISAs, long-term savings accounts or even investing in shares.

Find the right balance with purchases

Life is for living and, especially in challenging times, we should allow ourselves treats where and when possible but there is a definite balancing act. Question whether you are acting impulsively. Will you still feel the same way about that new purchase in a week’s time? Cross reference against your budget and determine whether this fits in to your spending plan.

It’s arguably more important than ever to put strategies in place that safeguard and enhance yours and your loved ones’ short, medium and long-term financial wellbeing. Following the right principles and staying both disciplined and consistent in your approach can help set you on that path.

At Wills & Trusts Wealth Management we are all about building futures and cementing legacies and our dedicated, experienced, knowledgeable and friendly team are here for you every step of the way.

To see what sets us apart, and to take the next steps to a prosperous financial future, get in touch today.

Paula O'Reilly

November 5, 2020