Money savings tips: How to keep your finances on track in 2022 | Personal Finance | Finance
Express.co.uk spoke exclusively to Becky O’Connor, head of pensions and savings at Interactive Investor, and she offered advice on how best to proceed. For people with extra savings from lockdown, she suggests keeping them handy and using them in an emergency.
She said: “There could be a tough year ahead, with rising inflation, taxes and the cost of energy.
“You may find that you have to dip into whatever savings you have.”
From April, the usual cost of living is expected to rise to around 10% once the energy cap is removed and the National Insurance hike begins.
Ms O’Connor suggested that people might need to start budgeting.
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She said: “If it becomes unaffordable for you, you may need to adjust your budget and cut back.
“Start with any frivolous expenses, such as subscriptions, that may have slipped through when you felt more comfortable.”
Additionally, to cope with the rising cost of groceries, many people have taken advantage of “Meatless Mondays” or reduced their meat intake a few times a week.
People can get into batch cooking and freezing, which can save energy and time, she added.
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With the UK inflation rate hitting 5.1% – its highest rate in a decade, people are being urged to consider ‘entertaining their savings’.
She continued: “Review your savings rates and how much you have in savings.
“If you don’t need it in the short term, consider diverting some of your savings to the stock market, through a stock and equity ISA, where it has a better chance of beating the market. currently high long-term inflation rate.
“Check your retirement pot returns. Does growth beat inflation?
“Could you invest a little more in stocks to give a little more potential for higher returns this year?”
Also, before borrowing money, Britons should “think twice”.
Getting into debt using buy now, pay later, or credit cards, store cards, or personal loans must be well thought out to avoid any negative outcomes.
She said, “Find out what is really important to you this year, and if your temptations don’t fit into that category, don’t buy them.
“If you made it without something, you can probably go on without it.
“Check your spending and saving efforts weekly if you can, and consider small, inexpensive rewards if you’ve been particularly successful at saving a week.”
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