Have you been caught out again? You know what it's like: one minute you're on the beach making the most of the last of the summer sunshine, then the kids go back to school - and suddenly the Christmas decorations are going up in the High Street and you're wondering how you can possibly afford to buy presents for everyone and stock up the fridge for a full-scale family Christmas feast. Don't panic, however - it's not too late to start planning your festive finances.
It's easy to put away a little each month using a standing order, and even late in the autumn, you could still save enough to splash out during the party season - don't forget that the cost of taxis home, a few rounds of drinks and perhaps a new dress or pair of shoes will soon add up. Time your standing order to go out to a savings account as soon as your salary lands in your bank account, and you won't even notice that the money's gone.
You can easily keep an eye on how the sums are adding up with an online savings account, which will also allow you to move your money around with a minimum of fuss. Think of it as a virtual piggy bank - or your party fund, if that's a more exciting prospect.
The same method works whatever you're saving for, at any time of the year. After Christmas, try putting away a small sum each month towards your summer holiday; work out the monthly instalments you'd need to save to buy your next car, redecorate your house, or whatever else you'll be wanting to spend out on over the next twelve months or so. The earlier you start saving for these eventualities, the less painful the payment process will be. And trying to save cash needn't be a miserable, miserly experience of denying yourself everything you enjoy in life: the further ahead you plan, the less noticeable the penny-pinching will be.
Decide whether you'd like to save into a regular savings account, an online account, or take advantage of cash ISA rates if you've not yet used up your tax-free ISA, allowance this year. Consider accounts which demand a notice period before you can withdraw your money, if that's what it will take to stop you from dipping in there regularly - though obviously, make sure you can access your cash if you really have to. Don't tie your money up for too long if you're worried that you might need it urgently. It's worth considering a fixed or flexible bond too; with a fixed bond you will be committed to putting the money away for a certain term, while with an 18 month flexible bond you can withdraw up to 30 per cent of the money saved without incurring any charges.
If you start saving in January you will have a nice nest-egg come December, particularly if you set up that monthly standing order. And another route to consider is an offset mortgage. This combines your savings and your mortgage, setting the savings against the outstanding mortgage debt. Interest is only charged on the balance remaining, which means overall interest is reduced and you will be able to pay your mortgage off earlier. You still have access to your savings - if you withdraw money, the mortgage balance will be adjusted accordingly.
If you save with an end result in mind, it can be easier than simply trying to build up a sum of money; visualise your reward for your careful budgeting, and then enjoy the satisfaction when you've reached your target and paid for it without going into debt. Your pleasures and more frivolous purchases can then come with no guilt attached. Issued by Barclays
This article has been written for information and interest purposes only. The information contained within this article is the opinion of the author only, and should not be construed as advice or used to make financial decisions. Expert financial advice should always be sought and any links contained within this article are included for information purposes only.