World Savings Day – an event created to increase awareness of the importance of savings – falls every year on 31 October.
To celebrate the 81st anniversary of the event, Which? money experts share five tips to help you boost your savings.
Boost your savings rate
The Which? Money Compare savings and Isa tables let you search hundreds of savings accounts and Isas from providers large and small to find a great savings rate based on quality of service as well as cost and benefits.
Moving your funds into a best-rate account is simple, so there’s no excuse not to ensure your savings are earning as much interest as possible.
Compare your savings rate with other deals on the market, and consider switching accounts if you find a better deal.
Which? Money Compare Table: Savings accounts and Isas – hundreds of accounts compared
Consider storing small savings pots in current accounts
If you’ve got a small savings pot and would like instant access to your money, you might be better off storing your funds in an interest-paying current account.
Some current accounts offer rates higher than anything available in the savings account and Isa markets, albeit only on small balances and often with several conditions attached.
Savers with between £3,000 and £20,000 can earn 3% gross in Santander’s 123 account. Nationwide and TSB also offer top-paying current accounts, both paying 5% on balances up to £2,500 and £2,000 respectively.
Some current accounts require minimum monthly funding and direct debits to be set up in order for interest to be paid. Check our current account reviews to learn more about the terms and conditions of specific accounts.
Investigate peer-to-peer lending
Peer-to-peer lending websites match up savers who are willing to lend with borrowers. These websites don’t have the overheads of traditional banks and can therefore offer better interest rates. What’s more, peer-to-peer Isas will be introduced next April, meaning savers will be able to invest in this model without paying tax on their profits.
However, there are risks involved. The most immediate risk to your capital is if a borrower fails to repay what you have lent them, although most peer-to-peer websites have systems in place to compensate savers in this scenario.
These platforms aren’t covered by the Financial Services Compensation Scheme (FSCS) either, which means your savings are not guaranteed to be protected if a peer-to-peer website goes bust.
See our peer-to-peer lending guide for a detailed explanation of how these websites work and reviews of the UK’s three biggest peer-to-peer lending sites – RateSetter, Zopa and Funding Circle.
Learn how to get higher returns from the stock market
Investing your money can produce higher returns than keeping your savings with a bank, particularly if you’re willing to leave your money invested for a longer period.
It’s a big step though, as you need to be prepared for the possibility of losing money.
See our ’50 ways’ guides if you’re struggling to save
If you’re struggling to find funds to save for a rainy day, Which? is here to help.
- Are your savings protected? Check using our guide to the Financial Services Compensation Scheme
- See our step-by-step guide to switching your savings account
- Compare your savings rate to other accounts on the market using our saving rates booster
Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.