It’s not just customers of Lloyds Bank that can benefit
Lloyds Bank has urged its customers to use its handy tool, which could help boost their savings. And the good news is that you don’t have to be with the bank to use it.
The banking group, which is part of the same family as Halifax and Bank of Scotland, operate a ‘savings calculator’. The idea is to use the tool to help you work out “when you could reach and how much you’ll need to achieve your financial goals.”
Discussing why it’s a good idea to use a savings calculator, it explains: “You could be planning a large expense, or just want the peace of mind that you’ve got a financial safety net in place.”
It adds that regardless of what our goal is, a savings account calculator can help you quickly work out:
- How much you’ll need to put aside each month to meet your goal
- How long it could take to save the desired amount
It continues: “You could also be considering whether to choose between savings or credit. If you can afford to wait, it often pays off to take your time and save up for the things you want. While credit is convenient, it could be more expensive, especially when you account for interest, fees and other charges.”
The rules are simple. All you need to do is visit its website here. From there, you enter:
- How much money you have already saved
- Realistically how much you could save every month
- How long you can save for in years and months
As an example, we entered that we wanted to save £50 per month and that we already had £100 in our bank account saved. Keeping it simple, we stuck with a 12-month plan and entered that we wanted to save for one year.
After we clicked on ‘calculate’, it said: “Based on these details, we estimate that you could have £700 by the time you finish saving.” That’s enough to help buy a new home, help save up for a deposit, save up for the summer holiday, or just build up your emergency fund.
In separate advice, it notes that if people want to boost their savings, they should have a plan in place and explains: “Knowing what you can afford to save or invest each month will help you to plan your next payday, and your longer-term financial future. The 50:30:20 rule could help you to get started.”
What is a 50-30-20 rule?
The 50-30-20 rule, or budget, divides your monthly after-tax income into three clear areas.
- 50% of your income is used for needs. This can cover everything from bills to food shopping.
- 30% is spent on any wants. Think days out with your family, dinner at a restaurant or any holiday plans.
- 20% goes towards savings. This includes things like topping up your emergency savings fund or setting aside money for investments.
You might find sticking to the 50-30-20 rule is easier than some budget plans. Having only three categories to keep track of can save you valuable time and stress worrying about what to do with your pay.
It also gives a balanced structure between essentials, enjoyment and planning for the future. You can read all about the 50-30-20 rule here.
