Make your money work harder for you

Whether you’re focused on what needs doing today, or you’re setting out your goals for tomorrow, we want to help you find a balance that works.

Not sure what to do with your money? Ask yourself:

What are your financial goals?

Everyone’s goals are different. Having a clear idea of what you want to achieve can help you focus your finances and work out what to do with your money.

When do you want to achieve them by?

Having a clear timeframe can help motivate you to meet your goals. It can also help you decide how to structure your plan, and where best to put your money. 

How will you go about it?


Finally, you can think about how you will achieve your goals. Do you want to save or invest your money? Not only will this depend on your goals and timescales, but also how much risk you want to take.

Finding the right balance for your finances

A smart financial plan relies on balance. But first and foremost you need to consider your personal situation.

The 50 30 20 rule is a good place to start when thinking about how you manage and budget your money. It will also help you to decide how much you could put aside towards the future.

While it can be tempting to jump in feet first, allocating a realistic budget to each part of your plan can prevent you from overstretching yourself.

Explore the 4 main ways you can make your money work for you:

Savings
 

Info graphic shows example reasons for emergency savings. These include, unanticpated travel, job loss, emergency pet care, home repairs, home appliance replacement and car repairs.

Make your money work harder for you

Savings are an important part of your financial plan. They can give you security, easy access to your money and steady growth.

Having an emergency savings fund equal to around 3 to 6 months of outgoings is a sensible place to start. This can give you peace of mind in case of emergencies. Then once you’ve built up your safety net, you can think about saving for short-term goals, such as a holiday or special event.

When saving, look for the best easy-access savings rate. Or, if you can tie up cash for more than 6 months, you may get a better rate if you grow your money with a fixed rate savings account.


Get savings tips

Investing
 

Scales icon

Investing for the future

Investing can be a good option for a well-balanced plan, especially for any long-term goals you may have.

Investments are not guaranteed to grow your money, as their value can fall as well as rise. So, you should look to leave your money invested for at least five years, to help ride out any market changes and give you a better opportunity for growth.

Stocks and shares can be a good addition to your savings and not a replacement for them.


Learn more about investing

Pensions
 

Graphic showing the government top up of an extra £25 for every £100 invested in pension.

Plan ahead with pensions

Paying extra money into your pension can be a good way to set yourself up for your retirement. You can also benefit from tax relief on the money that you pay in, making it a smart way to get more from your money.

For example, if you’re a basic-rate taxpayer (20%), the Government will top up your pension with an extra £25 for every £100 you pay in. Though there are limits to this relief.

Higher-rate taxpayers (40%) can also claim additional tax relief via self-assessment. Tax treatment depends on individual circumstances and may be subject to change.

The money you put in your pension will be locked away until you’re at least 55 years old. This is set to increase to 57 in April 2028. Consider your options if you may need to access this money sooner.


Explore pension options

Mortgages
 

Graphic illustration shows the interest saving of £2,094 (at 3% over 10 years) based on a £100k mortgage and a- £10k lump sum overpayment.

Prioritise your mortgage

If you have a mortgage, one of your goals may be to pay it off early. While this could be a good idea, it may be better to pay off any other debts first, especially if they have a higher interest rate.

If you are on a fixed rate mortgage and face higher repayments when it runs out, it may be worth paying some money off your mortgage while your interest rate is lower. This can reduce the impact of a rise in future payments.

It’s also worth checking to see if you have any Early Repayment Charges as some mortgage lenders allow a maximum 10% overpayment each year.


Managing your mortgage

Finding the right balance for your finances

A smart financial plan relies on balance. But first and foremost you need to consider your personal situation.

The 50 30 20 rule is a good place to start when thinking about how you manage and budget your money. It will also help you to decide how much you could put aside towards the future.

While it can be tempting to jump in feet first, allocating a realistic budget to each part of your plan can prevent you from overstretching yourself.

Explore the 4 main ways you can make your money work for you:

  • Info graphic shows example reasons for emergency savings. These include, unanticpated travel, job loss, emergency pet care, home repairs, home appliance replacement and car repairs.

    Make your money work harder for you

    Savings are an important part of your financial plan. They can give you security, easy access to your money and steady growth.

    Having an emergency savings fund equal to around 3 to 6 months of outgoings is a sensible place to start. This can give you peace of mind in case of emergencies. Then once you’ve built up your safety net, you can think about saving for short-term goals, such as a holiday or special event.

    When saving, look for the best easy-access savings rate. Or, if you can tie up cash for more than 6 months, you may get a better rate if you grow your money with a fixed rate savings account.


    Get savings tips

  • Scales icon

    Investing for the future

    Investing can be a good option for a well-balanced plan, especially for any long-term goals you may have.

    Investments are not guaranteed to grow your money, as their value can fall as well as rise. So, you should look to leave your money invested for at least five years, to help ride out any market changes and give you a better opportunity for growth.

    Stocks and shares can be a good addition to your savings and not a replacement for them.


    Learn more about investing

  • Graphic showing the government top up of an extra £25 for every £100 invested in pension.

    Plan ahead with pensions

    Paying extra money into your pension can be a good way to set yourself up for your retirement. You can also benefit from tax relief on the money that you pay in, making it a smart way to get more from your money.

    For example, if you’re a basic-rate taxpayer (20%), the Government will top up your pension with an extra £25 for every £100 you pay in. Though there are limits to this relief.

    Higher-rate taxpayers (40%) can also claim additional tax relief via self-assessment. Tax treatment depends on individual circumstances and may be subject to change.

    The money you put in your pension will be locked away until you’re at least 55 years old. This is set to increase to 57 in April 2028. Consider your options if you may need to access this money sooner.


    Explore pension options

  • Graphic illustration shows the interest saving of £2,094 (at 3% over 10 years) based on a £100k mortgage and a- £10k lump sum overpayment.

    Prioritise your mortgage

    If you have a mortgage, one of your goals may be to pay it off early. While this could be a good idea, it may be better to pay off any other debts first, especially if they have a higher interest rate.

    If you are on a fixed rate mortgage and face higher repayments when it runs out, it may be worth paying some money off your mortgage while your interest rate is lower. This can reduce the impact of a rise in future payments.

    It’s also worth checking to see if you have any Early Repayment Charges as some mortgage lenders allow a maximum 10% overpayment each year.


    Managing your mortgage


Should you save or invest?

Now you know your options, it’s time to decide how, when and where you want to put your money. Part of this is working out whether you want to save or invest. While both can help you grow your money in their own way, there are different risks and benefits to weigh up. 


Compare saving vs investing

 

Take the next steps to help grow your money

Your next steps will depend on your own personal situation. It might be that your plans don’t need to change at all. But here are four steps you can consider:

Take the next steps to help grow your money

Your next steps will depend on your own personal situation. It might be that your plans don’t need to change at all. But here are four steps you can consider:

1. Make your own plan

There’s no one size fits all when it comes to making your plan. So, it’s up to you whether you focus on investing, saving or a combination of both.

2. Get up to speed

As you build out your plan, take time to understand the different options available. Then you can weigh up what may work best for your circumstances.

3. Go for your goals

Your goals are what will help you choose where to put your money. When building your plan, make sure you factor in goals for now and the future.

4. Regularly check in on your finances

It’s normal for your finances to change as your life changes. So, don’t be afraid to review your money and where it’s going, and update your plan along the way.

How can inflation affect your savings?

Find out what rising inflation means for you and your money and how to make sure you’re prepared for it.


Understand the impact of inflation

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