How to stop your savings from Plummeting
Updated: Aug 22, 2020
WTF is this blog about!?
Saving money can be really f*@king hard, but it doesn't have to be.
There are apps and chatbots available to help you put money aside automatically.
I personally use Plum, which has enabled me save enough money for my holidays this year in just a couple of months - without me having to do a thing!
You can download Plum here.
Let's face it, saving is hard! Especially when it contradicts your mantra of #livingyourbestlife.
I've always been pretty good at saving for long term goals (i.e. retirement and a house deposit) because I send a portion of my salary directly to an ISA on #payday each month, preventing me from splurging all of my hard earned cash on useless crap. But, making a conscious decision to squirrel away money for shorter term expenses, such as holidays, is another story. Well, it was, until I discovered Plum.
What is Plum?
Plum is a chatbot that tracks your spending and helps you save money automatically - so that you don't have to worry about it.
How does Plum work?
Plum links to your bank account and tracks your spending, using AI to calculate how much money it should automatically put aside for you every few days. Plum can be accessed via an iOS or Android app or through Facebook Messenger (which is how I use it, 'cause I'm old skool).
Need money A$AP Rocky? Don't worry, you can withdraw your money or cancel Plum at any time. You can also adjust how much Plum is setting aside for you by updating your 'mood', which ranges from shy to beast mode.
What can Plum do?
1. Save money
Automatic saving is a game changer! I've saved enough for my holiday this year in just a couple of months, without having to lift a finger and, best of all, I haven't even noticed the money leaving my account!
Since Plum tracks your spending, the amount it takes changes every few days (and depending on your chosen 'mood'), there's even an option for you to 'round up' your spending (i.e. if you spend £1.75 - it will save 25p for you) and even though the amount it takes each time seems small, it really does add up!
My favourite part is that I wake up each morning to a Facebook message from Plum updating me on my savings and bank balance - this really helps you see the fruits of your labour (get it!? I love a good #PlumPun).
2. Invest money
Unlike normal bank accounts, you won't earn interest on your money when it's held with Plum, but, from as little as £1, you can choose to invest your money to help it grow.
Plum offers a Stocks & Shares ISA*, which enables you to invest in a range of funds based on your chosen risk level and theme i.e. the area you would like to invest in, such as tech or UK-based companies. This means that you can sit back and relax whilst Plum does the hard work of choosing which companies to invest in for you.
To invest with Plum you are required to pay a monthly fee of £1, plus a management charge and fund fee on top of this (as far as costs go, you could probably get a cheaper offering by going direct to a fund manager, but it is pretty convenient doing it through Plum).
As with all investments, your money is at risk, therefore it is possible to get back less than you put in, which is why you should typically only invest your money when you're saving for long term goals (i.e. in 5-years' time). So if, like me, you're using Plum to save for a holiday, I wouldn't recommend investing it (otherwise your dream holiday in Barbados might amount to a weekend in Blackpool).
2. Track money
Gone are the days when you had to sift through endless bank statements and receipts, since Plum provides a breakdown of what you've been spending your money on, allowing you to see just how much those daily flat whites are costing you.
Another handy feature on Plum is that whilst it's tracking your spending to calculate how much it should save for you, it also checks whether you're being overcharged for bills - handy, right?
I've been using Plum for almost a year now and I think it's brilliant! It has allowed me to save for my holidays effortlessly and it's super user-friendly.
Why not give it a go? You can download Plum here.
But don't just take my word for it - check out the hundreds of reviews here.
If I haven't managed to persuade you that Plum is awesome, maybe consider checking out these similar products: Cleo, Chip and Moneybox.
*I will write a blog about Stocks & Shares ISA's soon but, in the meantime, an important thing to note here is that you can only pay into one Stocks & Shares ISA each tax year - so if you already have one with another provider (or have reached the maximum £20k yearly contribution - woo go you!), you can invest via the General Investment Account instead.
This post contains affiliate links.
Now for the serious part: my blogs are for educational purposes only; they do not constitute financial advice. Please consult with an independent financial advisor for advice on your specific circumstances.