If you want to start to build up your saving, then you may wonder how much you should be saving. It can depend on a number of factors and it is good to have think about these as they can help you to decide more easily.
Are you saving for something specific? – if you are saving for a specific item then you will be able to find out how much it will cost and therefore how much you will need to save. It might be that you have a particular date that you need the item by. If this is the case then you will be able to work out how much you will have to save up each month or week if you want to have enough by a certain date. If you do not have a date when you want to get the item then it could be a good idea to think about whether you want to set a date. It might help you to focus your saving better and it could be motivating to you and help you with saving harder. If you do not have a specific amount, as you are not saving for a specific item or you do not know how much it will cost then it could be a good idea to set a target like the date as this will again help to motivate and focus you better.
How much can you afford? – it is also worth working out how much you can afford to save. If you take a look at your previous bank statements you will be able to see how much money you normally spend and earn in a month. The difference between these is the amount that you will be able to easily save. However, you might find that you will be able to save more than this if you change your spending and earning habits. It could be possible for your to earn more money or to spend less on certain things. You will need to think about whether you are prepared to do either of these things. Whether you choose to do either or both will depend on how motivated you are to save more money and how easy you think it will be for you to do these things. You may not be able to work or you may be working as many hours as you think you are capable of already. However, you might be happy to try to find more work and earn a bit more. You may also find that you will easily be able to cut back on spending in certain areas such as on luxury items but you may find this difficult if you already spend very little and do not buy many luxury items anyway.
How much do you want to save? – you will also find that you will have an amount in mind that you want to save. Even if you are not saving up for a specific thing you will have some sort of idea. It might be that you would like a bit of money to help you out in emergencies or a few months wages in case you lose your job. Think about how much you might like and this will help you to focus and decide how much to save each month.
So, by combining these different things, you should be able to work out how much you would like to save up in total and how much you will be able to afford to save each month. All you need to do then is to make sure that you find a good savings account that will pay you a competitive interest rate.