Britons urged to ‘seriously consider’ financial position – 5 tips that could help

HSBC offers advice on saving money for 'The Long Game'

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The cost of living crisis will likely not be a short-term experience, and with finances stretched thin people could greatly benefit from understanding their savings and investing potential. To help Britons get to grips with their pounds, Express.co.uk compiled the top savings accounts now on offer, five tips for people to “take charge of their finances”, and one young investor who shared the difference financial education can make.

Rachel Springall, finance expert at Money Facts, urged Britons to save for the future, saying it “is a vital way to avoid short-term credit and instil a positive habit. As the cost of living rises it can be hard for people to put money aside each month, but it’s important to seriously consider how someone can afford to cover unexpected purchases or a sudden increase in monthly expenses.”

One easy way to encourage good savings habits is through regular saver accounts, which award savers with attractive interest rates provided they save consistently. 

Money Facts shared some of the top accounts on offer at the moment:

  • NatWest Digital Regular Saver offering 3.25 percent monthly variable interest
  • Nationwide Building Society Flex Regular Saver offering 2.50 percent variable interest
  • First Direct Regular Saver Account offers 3.50 percent fixed interest.

Regular saver accounts generally have limits on how little or how much can be deposited consistently.

The NatWest and Nationwide accounts have no lower limits but do have an upper limit of £150 and £200 respectively. 

The first direct account requires savers to deposit a minimum of £25 and a maximum of £300 every month. 

Ms Springall highlighted: “The majority of regular savings accounts on the market are either exclusive to new or existing current account customers or have some kind of eligibility criteria, so savers will need to compare deals carefully before they apply.”

HSBC UK senior customer propositions manager, Steve Reay, commented that while everyone is facing the financial realities, Generation Z may be hardest hit. 

He said: “Amongst those facing increasing pressure is Generation Z; the under-25s who are seeing record-breaking house prices and sky-high inflation, while reading stories about how ‘cutting down on takeaway coffee’ will solve their financial worries.”

He admitted that the current situation has “no overnight fix” and shared five of his top tips to budget, spend and save “like a pro” but without “cutting out all the good stuff”. 

Take advantage of tools

Digital finance is a booming industry, with new tools and opportunities being introduced everyday, providing better services that can help people control their finances. 

Many free apps and tools are available online, and some are offered through one’s bank such as HSBC UK’s Balance After Bills feature. 

Budget

A common, yet often misunderstood, aspect of financial management is budgeting, which Mr Reay claims “Can be the first step to better financial health.”

He advised: “Budgets should include essentials like rent, utility bills and transport, as well as variable expenses like eating out, entertainment, and travel.”

Be aware of commitments

Mr Reay shared that the “key to successful planning” can lie in just understanding and reviewing one’s monthly financial commitments. 

This can include the likes of subscriptions, debts, credit deals, which could potentially be reduced by exploring other options through a price comparison website, if they can’t be cut entirely. 

Ask for help

In the current economic climate many are finding themselves in unfamiliar territory, and it’s entirely okay to ask for advice in times like these. 

Mr Reay shared: “If you’ve missed a payment or are worried about missing one in the future, talk to your bank or financial service provider as soon as possible.  Several government organisations and charities can also provide help and independent advice about managing money, including Citizens Advice, AdviceUK, National Debtline, and StepChange Debt Charity.”

Investing

Investing can be a daunting topic for many, but as millennials and Gen Z invest earlier than their parents did, there’s never been a better time to broach the subject. 

Investopedia found that 54 percent of Gen Z adults, aged 18 to 25, already hold some kind of investment compared to 31 percent of Millennials who were investing before the age of 21. 

Madeleine Garratt, 24, started investing just last April, setting up all she needed through mobile banking, and encouraged other Gen Zs to use their spare cash for their future. 

She commented: “Like a lot of people my age, I currently live at home meaning I’m able to commit to putting money into investments each month.

“While I understand this is a privileged position to be in, I think a lot of Gen Zs are having to stay with their family for longer due to the increased cost of living.

“It does allow us to turn to things like investing, however, so I’ve spent some time learning about the different sectors I can put money into and the potential gains and risks of those.

“Overall, I’ve been surprised at how simple it is to invest, and how much control this can give you over your finances. Helpful resources are available everywhere – from TikTok and Instagram to written articles that take you through the process.”

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