Trick yourself into saving

Squirrel something away for the future, even if it feels like you can’t

Take control...

With a Child Trust Fund about to come into your control, it’s easy to think of this money the way you would treat a 20 pound note from a loved one on your birthday; "Free money! Let’s go spending!"

But remind yourself: it’s not free money, it’s just money. The same money you work hard to save so you can reach your goals. The same money your loved ones work hard for and potentially deposited in your account.

Use our calculator to help value the Child Trust Fund you are about to receive by the time it would take you to save it up. Once you know how long it would take you to save it up, have a think. Does it make you feel any differently about it?

Saving isn’t easy...

If you don’t pay close attention to your spending it can become impossible to save.

But there’s always a chance to save, even if it’s just a little, and that can add up to something significant over the long term.

Creating a budget

In order to work out where these savings can be made, you need to understand:

Essential expenses

What are your essential expenses – things like rent, food and transport costs.

Where the rest of your money goes

Understanding what else you've been spending your money on - such as shopping and subscriptions.

The first one is relatively easy, just add together all those essential expenses. The second one may require you to track your spending. There are some smartphone apps that can help you do this, but a spreadsheet or even a notepad will do.

Top tip

Download your bank statement and add in any cash payments you may have made. Try to tag them by the type of expense, e.g. travel, entertainment, leisure. You need to include everything.

Compare whatever income you receive with your spending. Are you saving anything? Once you know this you can start to look at those non-essential expenses and spot opportunities to save.

Identifying the savings

How much you can save depends on your lifestyle, and what you’re willing to compromise on. Sometimes we can be unaware of how much money we spend on unnecessary or overpriced things. Maybe it’s unnecessary taxis, takeaways or forgotten subscription services.

How much do you spend on coffee per week? It might not seem like much but when you do the maths the potential savings can soon mount up.

Each week 18 to 34-year olds spend an average of £5.56 on coffee, £5.74 on soft drinks, £9 on takeaways and £9.09 on lunch, according to Dacia.

Making your own coffee, preparing your own lunch and cutting back on takeaways could save you up to a thousand pounds over a year. Ditching your Netflix and Spotify subscriptions could save you an additional £225 over the year.

Coffee £5.56 £22.24 £289.12
Soft drinks £5.74 £22.96 £298.48
Takeaways £9 £36 £468
Lunches £9.09 £36.36 £472.68
Netflix N/A £8.99 £107.88
Spotify N/A £9.99 £119.88
TOTAL £1,756.04

Savings calculator

Once you’ve worked out how much you can afford to save each month, use our calculator to work out how long it would take you to save up the value of your Child Trust Fund.

What to do with your savings

The best thing to do with your savings depends on your circumstances, your attitude towards risk ad what you're hoping to achieve.

Your Child Trust Fund has been invested for a long time now. It’s important to think carefully about how to spend it, save it or invest it.

If you're saving it for a rainy day it might make sense to put it into a cash bank account or cash ISA where you can access it easily. If you're looking more long-term consider investing in stocks and shares.. Find out more about ISAs in our article What are ISAs?

Whatever you decide to do with your money it’s a good idea to speak with your parents, guardians or other trusted adults about it. We have a range of investment products that can help you keep your money invested for the future, whatever your goals may be.

Please note: OneFamily do not provide investment advice. You should always remember when dealing with stocks and shares, whilst they can have good potential for returns in the long run – their values can fall as well as rise. So, there’s always a chance you could get back less than is paid in.

Try our savings calculator...

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