We're all making the same basic savings mistakes

It might take longer than you think to achieve your goals

Updated: 

Female hand putting a coin into piggy bank

More than three people in five are currently saving up for something they want, new figures show, with younger Brits more committed to earmarking money for a future goal than anyone else.

That's according to research from Aldermore bank, which found seven in eight younger Brits have a long-term goal in mind when they put money away, compared with just over half of over-55s.

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But while it's good news people are saving, they are making some basic mistakes. The biggest being simply not saving enough.

"It's clear that the current rate of saving will result in it taking longer than people expect to achieve their goals," said Simon Healy, savings managing director at Aldermore.

The savings gap

The worry is that people's goals aren't meeting their savings. At the average rate, for example, it would take six years to save enough for a new kitchen and an astonishing 21 years to put enough money aside to act as a deposit for a home.

The good news is there are relatively simple steps to cut down the amount of time it will take you to reach your goals.

"Those who are able to establish a consistent saving habit, rather than just setting aside money they have left at the end of the month, will find it easiest to achieve their goals and there are steps everyone can take to ensure they are making the most of their savings," Aldermore's Healy said.

And as well as saving more, you need to ensure you're getting the biggest returns you can.

"We encourage everyone to shop around online for the best interest rates and considering longer fixed term accounts can often be a better way of increasing returns," he said.

As well as looking for the best rates, it's also important to take advantage of help that's provided by the government, he added.

"Savers, especially those lower rate tax payers exempt from Personal Savings Allowance, can also utilise the tax-free status of ISAs to keep more of the interest they earn and home-owners specifically should consider the Government backed Help to Buy: ISA, which offer extra bonus payments when saving a specific amount each month."

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