With living costs rising at their fastest rate since 1992, the topic of savings is hot on everyone’s lips.
However, with so much information out there, it can be hard to cut the wheat from the chaff. That’s why we’ve broken down some money myths below.
Myth One: Budgeting doesn’t work
If you already keep track of your money, you may think that you don’t need to budget. Yet this couldn’t be further from the truth!
If you tend to dabble in online shopping and gradually watch your bank balance decline as the month goes on, you may think that although your spending maybe a tad frivolous, you’ve got a handle on it.
However, without proper budgeting, you’re likely to drift from payday to payday with little purpose. By budgeting properly and setting aside money to put into savings each month, you can get more from your paycheque. Whether you’re saving for a house, holiday or paying off debts, budgeting is a good place to start.
Myth Two: I don’t have enough money to save
According to ONS data, the median weekly pay for full-time employees in the UK is £611, so chances are you do have some money to save.
Although you may not feel like Elon Musk, even if you only have as little as £50 per month available to save, it’s still worthwhile saving for a rainy day.
If you’re looking to start your savings journey, it’s a good idea to shop around and look at different online savings account options to see which is the most appropriate for you.
Myth Three: You can’t have more than one current account
This is simply not the case! In fact, you can have as many current accounts as you like, across as many financial institutions as you like.
What’s more, as different banks offer different incentives for choosing their accounts, it can actually be beneficial to have several current accounts.
Myth Four: Low-interest rates means it’s not worth saving
Although savings accounts don’t attract as much money as investing your money in stocks and shares, savings accounts do still offer interest. As such, putting your money in a savings account is a smart way of earning money whilst doing nothing!
Myth Five: I can’t have more than one ISA
Once again, this is a myth! You can have more than one ISA. However, there are some rules you’ll need to be aware of before you start opening accounts left, right and centre.
Firstly, your total investments in any tax year must be less than £20,000. Secondly, although you can have multiple ISAs, they must be different ISA types. For example, you can have a cash ISA, stocks and shares ISA and lifetime ISA, but you can’t have two cash ISAs.
The bottom line is that there is a lot of misinformation out there. As such, you may be put off saving. Now that we’ve armed you with the knowledge you need to get saving, why not get started today?