Easy ways to save

Omotola Akerele, editor, MSN Money

Saving money doesn’t have to be hard work. We’ve found six ways to make saving so easy that you’ll hardly notice you’re doing it.

1) Sweep it up

Some banks and building societies such as First Direct and Abbey operate a sweep facility where once a month any cash left over in your current account is moved into a higher-rate savings account. It's swept away without you noticing so you don't have to go through the hassle. Do check that the savings account offers competitive rates though or you'll find that you're not getting the most from your money.

2) Save the Change

Lloyds TSB offers a Save the Change scheme. If you sign up to it, Lloyds will round up the amount you spend on your debit card to the nearest pound and transfer the difference into a Lloyds savings account. You'll have to switch to Lloyds' current and savings accounts (although Lloyds does most of the heavy lifting) and make sure your current account is in credit but, otherwise, the scheme is hassle-free.

3) Use a high-interest current account

A high-interest current account can help you save. Since you're likely to have some of your income sitting in your current account for at least part of the month, you may as well earn something on it while it's there. Worried that some current accounts cap the amount to which the high interest rate applies? Just transfer any money in excess of the capped limit into a savings account to get an even better return.

4) Set up a direct debit

Although it requires a little more initial legwork than a sweep facility - in that you have to work out how much you can afford to put away every month - a direct debit ensures that a set amount is transferred to your savings account regularly. A tip is to set up this direct debit for payday - with all the other money going out to pay your bills, you'll probably won't notice it after a while.

5) Use a penny jar

"Little and often" should be your mantra here. No one really likes coins jingling about in their pocket, purse or wallet so 'get rid' of them by putting the change into a jar. Soon it will become a habit and you'll be amazed at how quickly your jar fills up. Once it's brimming, take the stash across to the bank and cash in your savings. This is an easy, no-frills method of saving and requires nothing but a large jar. And some change, of course.

6) Christmas savings clubs

These are an effective way of saving up for Christmas. The idea is for you to spread the cost so you pay in as little as £2 every month, which you then get back in December in the form of vouchers. The collapse of savings club Farepak in 2006, which saw 150,000 families left out of pocket two months before Christmas, dented the reputation of Christmas savings clubs. However, the introduction of the Christmas Prepayment Association should allay your fears given that if any of the large number of clubs it covers, such as the Variety or Family Christmas Savings clubs, goes bust, you'll be eligible to receive the value of your savings back in either vouchers or goods.

Notes …

* This newsletter has been prepared with all possible care to ensure its accuracy. It is based on our current understanding of legislation and HMRC practice. 
* Neither Aisa Direct Ltd nor any of its employees can accept responsibility for any errors or omissions. You should seek further professional advice prior to action.