We're often told of the importance of saving, and many of us like to think that we're pretty savvy with it. But do you know the difference between saving money and actual saving? According to research from TopCashback.co.uk, a lot of consumers tend to confuse the two.
The survey found that only 32% of respondents realise the difference between the terms, which is perhaps why 75% consider themselves savers, even though only 39% regularly put money into a savings account. Indeed, 33% believe that getting a discount is more important than saving regularly (23%), but while the former is a great way to make your budget go further, it won't give your finances a boost for the long term.
While it's good news that 81% of respondents spend wisely – with 55% doing so every time they shop – unless you put any money saved to better use, you may not even notice the benefit. This could be a widespread issue, as while 49% of consumers see the money they save from spending wisely as cash to be put aside or spent elsewhere, 36% see the lower cost as the final price, and don't view it as a saving at all.
As a result, there are concerns that many people are storing up issues for the future, with a lack of financial resilience being a real possibility. "Our research highlights an issue with what people consider saving to be," said Adam Bullock, UK director of TopCashback.co.uk. "Although consumers typically save £43.23 each month by using discounts, it may not be enough when it comes to saving for a car, home or later life. People could be better off by making their money work harder for them.
"It is likely people are spending wisely to make ends meet, making it tricky to put away any leftover cash. But, if people aren't putting this money aside into a savings account, the efforts of spending wisely will not have an impact on actual savings, and the need to make ends meet each month will only continue."
Saving money may be viewed as the easier option – 41% of respondents said they find it easier to spend well rather than save, compared with 22% who believe the opposite – but it's important to focus just as much on actual saving. You want to be squirrelling away as much as you can on a regular basis to allow your funds to build up over time, and there are plenty of other things you can try to boost your balance even further.
What about cashback? Whether you shop through a cashback website or get a cashback credit card, or even a debit card with the right current account, getting cashback can be a great way to shore up your finances – particularly if you transfer it into a savings account.
However, to really make the most of your savvy spending, you'll need to make sure you've got the best savings rate possible, and that all comes down to doing your research. Checking out our Best Buys could be a great place to start, and once you've found the right deal, you can make the most of your money-saving habit and watch your savings pot grow.
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.