Put some cash away for an unexpected rainy day

COMMENT

RICKY Diggins from Bank of Scotland says above that it can be a major challenge to save when the day to day pressure of just living and paying your bills seems to take every single penny that you earn – and sometimes even more.

He’s right. It is a major challenge, and it’s a challenge that many of us are failing, as evidenced by the results of the bank’s research.

But we have to keep trying. More and more Scots are struggling with debt these days. Part of that is historic long-term debt that can’t be erased immediately and a lot of it is down to the fact that prices have been rising much faster than wages for many Scots for more than a decade now.

But there is a part of it that is down to the fact we let what happens with our money wash over us and don’t take full of control of how we manage our money and the things that we spend it on.

There are many of us who could save some money by taking more care in the arrangements that we make with third parties – in the insurance policies that we buy and the TV and broadband and utility bill arrangements that we set up.

If we took more care with some of these arrangements, then perhaps we would be able to put a little bit into a savings account every week, making sure that we were using an account that at least paid a little bit of interest.

And there is then no question that this money would start to build up gradually and act as some sort of emergency fund.

The benefit of having this rainy day money is that, if we are then faced with unexpected expenditure because a car breaks down or a roof starts to leak, then we can pay for repairs without having to resort to an expensive short-term loan that just adds to levels of debt and becomes difficult to pay off and perpetuates the vicious cycle.