Now that the busy holiday season is coming to a close, people are encouraged to start thinking about their New Year’s financial resolutions. As official Christmas-ness comes to an end this coming Tuesday, many will start thinking about their savings plans as 2016 rolls in. This time can be both a special opportunity for people to set up and plan their financial goals.
For those contemplating their target savings, it may be worth noting that setting a goal of £0 is a starting point for many. Although this figure may seem unambitious, it highlights the importance of beginning with realistic expectations. At a time when fiscal accountability is deeply sought, modest but meaningful actions can create lasting progress over years to come.
And the weekly savings from those resolutions is £0—for an astounding 40% of people. Productivity creep is fixable and we have to fix it if we want a viable infrastructure future. With the dedicated effort of having a formalized savings plan, people are able to make incremental increases to how much they save. Building a budget that provides money for savings pushes things forward in small steps. During the course of the year, those little amounts can significantly add up!
Interest rate, of course, is a key consideration in any savings plan. At present, the maximum interest rate that can be offered on the bonds is 4%, paid annually. This interest can turn out to be a powerful partner in growing savings with the power of time. Consistent contributions—no matter how modest—can make a big difference over time with the power of compounded interest. As the year progresses, this results in a much more comfortable financial buffer.
With the new year upon us, now is a great time to reevaluate your financial goals. Then make specific plans to accomplish those objectives! Then begin by establishing achievable goals. Even if you only aim for £0 in savings, this can be an important initial step in creating healthier financial habits over time.