Talking money: How have our saving habits changed in recent years?

Over the past decade, saving habits have undergone a major transformation. Paired with an economic landscape in constant flux, rapidly evolving technologies are largely responsible. And as we adapt to the digital age, our investing, saving, and spending habits have become more focused, efficient, and accessible.

Though the UK has narrowly avoided recession, a bleak economic forecast has prompted many to stay prudent. Whether you’re opening an ISA for the first time or finding the best savings route, it’s always worth learning how others are going about the process.

 

Modern money: How are we saving differently?

  • The rise of digital banking

Mobile banking and digital payments have become the mainstream, contributing immensely to changing spending habits. Thanks to mobile banking apps, online account management is simple and bank transfers can be sent and received almost instantly. In turn, it’s now much easier for individuals to save and manage their money.

Additionally, banking apps offer personalised metrics, spending reports, and insights. As a result, individuals are becoming more aware of the way they spend and save money, allowing them to think carefully about each commitment.

  • Budgeting and payment plans

Saving doesn’t have to mean putting money aside in a separate account. While ISAs can be invaluable saving tools, cutting back on spending allows for spare cash at the end of the month.

Additionally, payment platforms for online shopping allow customers to spread the cost or pay later – without the need for a formal credit agreement. These can be a great way to help save over the long run whilst also helping improve credit score if payments are made on time!

  • Accessible investing

Online investment platforms make it easy for people to invest their money. Whether they choose to invest in stocks, corporate bonds, index funds, or anything else, it’s no longer a requirement to offer a large sum upfront.

People can invest with relatively small amounts of money, making the process more accessible and more democratic. And once individuals notice a return on investment, their efforts become more worthwhile and prove another way to maximise their income.

  • The Covid-19 pandemic

Throughout the past few years, navigating a global pandemic has caused a greater shift in spending habits. And for those who were still earning, lockdown presented a fantastic opportunity to save more money.

With workers forced to stay at home or placed on furlough, many were forced to or coincidentally cut back on spending. Almost half of homeworkers spent less money while working from home during the pandemic, channelling more efforts towards saving.

  • Financial education

In recent years, local initiatives have directed a greater focus towards financial understanding. Courses on financial independence and money management can now be accessed through schools, colleges, and higher education institutions.

Furthermore, it’s easier than ever before to access specialist financial advice. Many turn to the internet to learn about saving money, budgeting, and investing. Once people know more about making the most of their money, they start to feel encouraged to save for the future.

 

Conclusion

In recent years, a volatile economy has made people more conscious with their money. However, technological advances are the most significant factor when it comes to the evolution of saving habits. With the accessibility of mobile banking, budgeting apps, and investment platforms, individuals across the UK are learning how to make more out of their money.