Christmas is just around the corner and our annual festive splurging is starting to step up, but with research from American Express suggesting that households are expected to spend just shy of £1,500 on Christmas this year, many are wondering why they didn't put more money aside for the festivities. Well, it may be too late to start saving for this year's festive spend, but it's never too early to start for next year's!
It may seem a little premature to start thinking about Christmas 2017, particularly as many of us have only just started thinking about this year's festivities, but a bit of forward planning could pay dividends in a year's time – and if you start saving into a regular savings account, you could maximise the benefits even further.
Many of the best regular savings deals are fixed for 12 months, which means that, if you start now, your savings account will mature just in time for next year's spending spree. The table below outlines the top accounts available in the sector, and shows just how much you could get back in a year's time:
"It's amazing that, while we know Christmas will come around every year, its eventual arrival is still a surprise, leaving us all wishing that we had put some money aside to cover the cost of our Christmas cheer," said Charlotte Nelson, finance expert at Moneyfacts. "Well, with some careful planning, we can all deck the halls next year."
As the table shows, the savings can quickly add up. By putting just £50 a month into Saffron Building Society's regular savings account (for example), you could be well on your way to covering the cost of the average household Christmas spend – and if you squirrel away even more you could even surpass that total, giving you more than enough to indulge in a few extra treats from Santa.
Regular savings accounts can be perfect for this kind of goal, as they'll give you the discipline you need to save consistently by encouraging monthly deposits. Some will even charge penalties should you miss a monthly payment, so in those cases, there's no option but to get in the habit. However, you needn't worry about the amounts required: monthly payments can vary from a minimum of just £1 all the way up to a maximum of £3,000 a year. You can often amend your deposits throughout the year, too, so there'll be something to suit all budgets.
Not only that, but the potential returns on offer will make it all worthwhile – by opening a regular savings account, you could enjoy some of the highest rates of interest on offer at the moment, with the top rates far surpassing anything else available. Not only that, but many providers offer loyalty rates if you hold a current account with them – up to 5% in some cases – so you could earn even more.
However, it's important to be aware of the limitations. To curb any temptation to dip into your pot before it matures, many accounts charge a hefty interest penalty for withdrawals, and you'll also need to ensure that you can commit to the monthly payment in case you're penalised for missed deposits. This can be easily avoided by setting up a direct debit, however, and if you're committed to building up your pot, hopefully the withdrawal restrictions won't put too much of a dampener on things.
Above all, it's about being prepared. Charlotte concludes: "Money saved in a regular savings account can go towards any long-term purchase, but by getting into the habit now, savers can build up a nice chunk of cash for next year's yuletide."
Check out the top regular savings accounts and see if you can build a healthy savings pot in time for next year's festivities
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
Moneyfacts.co.uk will, like most other websites, place cookies onto your computer’s
hard drive. This includes tracking cookies.