Money matters: living for today with one-eye on tomorrow

Much of modern life centres on the notion of ‘living for today’ and not worrying too much about what tomorrow may bring. And to an extent, this attitude is based on sound principals given that much of what the future holds is completely outwith our control anyway.

But it’s for this very same reason that it’s equally unwise to live purely for the moment. Many people across the country are paying the price for living beyond their means and reaching a level of debt that, years later, is still affecting them.

Indeed, excluding mortgages, the average British household is now in debt to the tune of over ?9000, and whilst they may be able manage this level of debt and meet their monthly payment requirements, unexpected rises in interest rates or bills could spell trouble for those without savings to fall back on.

It is actually far easier to manage savings accounts than it once was, and for the most part they are also a lot less rigid than they once were too. For shorter-term savings it’s now possible to open up a simple online savings account that offers 24-hour access with unlimited access to your money. Not only that, it’s now easier than ever to transfer money into the savings account from other accounts.

A popular means of ensuring a little bit is saved every month is to set-up a standing order between a current account and a savings account, timed so that the transaction goes through to coincide with pay-day. This way, saving becomes an automatic process and little effort – or will power – is needed to make those savings grow.

Of course, for those looking more towards the long-term, an individual savings account (ISA) is probably the answer here, as they generally attract much higher levels of interest. Limited to one ISA per person per year, it is possible to deposit anything up to ?3,600 and pay no tax on any interest received. And, similar to the ordinary internet-only savings account, an ISA can be managed entirely online meaning there is no need to wait in lengthy bank queues to deposit or withdraw funds.

Furthermore, opening a bank saving account is as easy as completing an online application and then visiting a local branch with identification. And the great thing about many savings accounts is that they can be opened with as little as one pound, meaning there can be little excuse not to be putting away at least something every month.

So, many people choose to live beyond their means by getting into debt and not fully considering their future financial predicament. But by saving just a little bit each week or month, it’s surprising how easy it is to build a small reserve of money for those rainy days. Living for today is great to a certain extent, but just be sure to keep one eye on tomorrow, too!

Disclaimer:
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.