For many people, a new year means fresh starts, new goals, and a chance to grow. So, why not inject this into your savings habits for 2024?

Growing your money pot takes time, but the best thing to do is to understand why you want to save and make a plan to get there.

Louise Halliwell, Group Savings Director, Kent Reliance, said: “This New Year, the biggest savings habit to make is to get started. Once we get used to putting away part of our salary every month, the savings habit is born, and over time you may be motivated to save even more.

“It’s important to remember, everyone’s savings journey is different, so try to focus on your personal goals – whether that’s buying a first home, building up an emergency fund, or putting money aside for retirement.”

So, whatever your savings goals are, we wanted to share our five top tips on how to make the most out of the pennies you’re putting away.

1. Make the interest rate work for you

In a year where interest rates may be less likely to go up, you could look for options which will earn fixed interest. There are numerous best buy tables that help you find the best rate, so you can make your money work harder and maximise returns.

But remember the highest interest rate may not automatically be the best account for you. You should consider other factors, such as whether the interest will be tax-free and how quickly you can access your savings if you need the money.

2. There’s more to beating tax than just ISAs

ISAs often make the headlines as the most tax efficient route for savers - you can save £20,000 a year without paying any tax on the interest you earn. However, you can also save tax efficiently through regular savings accounts, using the Personal Savings Allowance - which allows you to earn up to £1,000 in interest (£500 for higher rate taxpayers) before paying tax.

3. Always stay prepared with an emergency fund

You should aim to get at least three months of salary tucked away as an emergency fund so that you can aim to cover any unexpected costs. For example, if something happens with your job or the boiler breaks down, you’ve got money on hand to help. It isn’t easy, but once you get going and get used to reducing a little of your spending money every month, you’re more likely to be motivated to continue saving.

Once you’ve worked out how much you can save, a good way to get started is to look for options like an instant access savings account where you can put in money and take it out as you need it. The rate won’t be as high as if you lock the money away, but it does offer flexibility so you can withdraw your money without facing penalties.

4. Make more from your savings by locking it away

After you’ve built up an accessible emergency fund, you can then think about savings accounts which lock your money away. You could earn more interest, so what you now need to think about is how long can you afford to not access the money. Typically, terms for notice periods range between 30 and 120 days, although some notice accounts require 180 days.

Also, think about what kind of saver you’re going to be – are you a ‘little and often’ person who wants to put money away every month or do you have a lump sum that you’re looking for the best return on?

5. Think beyond the money

Many banks will give you something extra for saving - whether that’s a contribution to charity – for example, our Demelza children’s savings account sees us donating the equivalent of 0.25% of the combined savings pot to help the children’s hospice.

Think about what matters most to you and use your savings power to your advantage.