Saving money can be incredibly difficult to do at the best of times but coronavirus has made it near impossible for many people to set cash aside for a rainy day. The pandemic has negatively impacted nearly every aspect of people’s financial wellbeing, from job security to income levels.
Despite the difficulties savers had to put up with in 2020, new research from Santander revealed many are entering 2021 with a positive mindset.
Research from Santander found that after a year of financial uncertainty, more than 28 percent of consumers want to improve their financial “know-how” in the coming year.
There is already evidence that some have got a head start on this, with 40 percent of consumers detailing they have been paying more attention to their personal finance information than when they did before the March lockdown was introduced.
Additionally, Santander’s research revealed the following:
- A quarter (26 percent) check their bank balance more regularly and shop around more for deals (23 percent) than compared to before the first lockdown
- Almost half (45 percent) are spending more time managing their household bills, with 17 percent spending more than a full extra hour extra a month managing them.
- People are also opening up about money, with a fifth (22 percent) saying they are now more likely to talk to their partner about managing their finances than before the pandemic.
- However there’s still some progress to be made in 2021 as the figures revealed that over a third (35 percent) of Brits admit to being regularly surprised by the cost of household bills and more than a quarter (29 percent) of 18-34-year olds say don’t know the cost of their monthly rent or mortgage payment.
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Evideently, with some people still being unsure of their outgoings many will likely want to have a “rainy day” fund to cover unexpected costs.
Fortunately, savings advice from Plum, the money management company, has found a way to build up such a pot by utilising the UKs actual rainy days.
Their “Rainy Days Rule” could allow savers to build up thousands throughout 2021, as Plum explained: “The Rainy Days Rule also uses automation to save more for you, but this method is a little more… well… weather dependent!
“Each day it rains in your local area, extra money is put aside in your savings for you.
“This rule can be customized depending on how much you want to save, or to keep things weather-appropriate, your ‘moisture level’ from £1 (“A Bit Damp”) to £20 (“Make It Rain”).
“London saw 109 rainy days last year, which would mean extra savings of up to £2,120 over the course of 12 months.”
Jess Williams, a Product Lead for Growth at Plum, explained the plan further: “The idea that the weather controls how much you save sounds a bit crazy.
“But believe it or not, this is a very effective way to save small amounts.
“What a lot of people struggle with is the decision-making process, how much and when to save.
“So as long as the decision is made, it doesn’t really matter that it’s triggered by quite a random event!
“I have to say though, it works pretty well in the UK where we get a lot of rain.
“Perhaps we need to make a Sunny Days Rule for our friends in warmer climes!”