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Setting savings goals

Girl reaching for the sky; image used for HSBC MY setting savings goals article page

Whether it’s for something big, like a house deposit, an event, or simply for your peace of mind, having a specific goal to save towards can help you stay focused.

By setting savings goals, you have a clear sense of purpose.

Studies into savings behaviour indicate that people who set savings goals save more, and reach their goals faster, than those who don’t. And although Bloomberg research1 suggests that our default human behaviour is to live in the moment, which makes saving money hard, the good news is that this can be easy to overcome with a few prompts or nudges. Having a goal goes a long way to helping do this.

So why not set some savings goals for yourself? You could start by thinking about the answers to some of these questions:

  • What do you want or need to buy in the next 12 months?

  • What breaks or holidays do you plan to take?

  • What high interest debts would you like to clear?

  • What are your medium term plans (e.g. saving for a home deposit)?

  • What savings might you need for your long term future (e.g. your retirement)?

  • What help would you like to be able to provide for your loved ones?

Once you've turned your answers into a savings plan, you’ll need to keep focused on it. Here are some ways to do that:

Set Title

What you should do: How you can do it:
Write your goals down

Place them somewhere visible like the fridge door, record them in a savings app, or make a note in your phone.

 

The idea is to make sure you see them often so you're reminded of them regularly.

Break big savings goals down

Break down big savings goals, like saving for a house deposit, into a series of smaller targets. Big goals can seem daunting, and when you don’t seem to be getting much closer to them it can be tempting to give up.

 

Breaking them down into smaller goals will make it easier to see the progress you're making and keep you motivated.

Get friends or family involved

Share your savings goal with them and ask them to check up on your progress on a regular basis. Better still, make it competitive and encourage them to set their own savings goals.

 

Sharing goals can make you feel more accountable for them, and encourage you to keep going.

Think about timescales

It can be helpful to think about your savings goals in terms of short term (like a holiday or a new car), medium term (e.g. a house deposit) and long term goals (e.g. pay off your mortgage or save towards a retirement fund).

 

By separating out your goals in this way, you can enjoy the gratification of reaching short term goals, while still having plans in place to reach your longer term goals.

Set Title

What you should do: Write your goals down
Write your goals down
How you can do it:

Place them somewhere visible like the fridge door, record them in a savings app, or make a note in your phone.

 

The idea is to make sure you see them often so you're reminded of them regularly.

Place them somewhere visible like the fridge door, record them in a savings app, or make a note in your phone.

 

The idea is to make sure you see them often so you're reminded of them regularly.

What you should do: Break big savings goals down
Break big savings goals down
How you can do it:

Break down big savings goals, like saving for a house deposit, into a series of smaller targets. Big goals can seem daunting, and when you don’t seem to be getting much closer to them it can be tempting to give up.

 

Breaking them down into smaller goals will make it easier to see the progress you're making and keep you motivated.

Break down big savings goals, like saving for a house deposit, into a series of smaller targets. Big goals can seem daunting, and when you don’t seem to be getting much closer to them it can be tempting to give up.

 

Breaking them down into smaller goals will make it easier to see the progress you're making and keep you motivated.

What you should do: Get friends or family involved
Get friends or family involved
How you can do it:

Share your savings goal with them and ask them to check up on your progress on a regular basis. Better still, make it competitive and encourage them to set their own savings goals.

 

Sharing goals can make you feel more accountable for them, and encourage you to keep going.

Share your savings goal with them and ask them to check up on your progress on a regular basis. Better still, make it competitive and encourage them to set their own savings goals.

 

Sharing goals can make you feel more accountable for them, and encourage you to keep going.

What you should do: Think about timescales
Think about timescales
How you can do it:

It can be helpful to think about your savings goals in terms of short term (like a holiday or a new car), medium term (e.g. a house deposit) and long term goals (e.g. pay off your mortgage or save towards a retirement fund).

 

By separating out your goals in this way, you can enjoy the gratification of reaching short term goals, while still having plans in place to reach your longer term goals.

It can be helpful to think about your savings goals in terms of short term (like a holiday or a new car), medium term (e.g. a house deposit) and long term goals (e.g. pay off your mortgage or save towards a retirement fund).

 

By separating out your goals in this way, you can enjoy the gratification of reaching short term goals, while still having plans in place to reach your longer term goals.

Ready to start saving?

Check out some of our savings accounts and see if there's one that's right for you.

And if you need more inspiration we've got even more tips on how to build up your savings.

1.Bloomberg, 18 October 2016: Can Science Make People Save Money?

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