4 helpful tips on how to build your nest egg this Easter

Easter marks the start of spring, the season of decluttering and preparation for new beginnings.

While the children and grandchildren are busy hunting for colourful eggs and devouring chocolate Easter bunnies, it’s an ideal time to think about getting your finances in order and building a tidy nest egg for the future.

Of course, saving is a useful habit to adopt year-round. And yet, while around 61% of British adults manage to save most months, research published by Money also reveals that up to a third of adults in the UK either have no savings or less than £1,000 in a savings account¹.

Whether your savings could do with a boost, or you want to give your finances a reboot, read on to discover four helpful tips for building your financial nest egg this Easter and beyond.

1. Set goals and create a financial plan to achieve them

Sticking to your savings strategy is likely to be much easier if you have clear goals in mind.

It might be helpful to think about your short-, medium-, and long-term goals. Perhaps you have your heart set on buying a new car this summer, but you also want to reduce your work hours in the next few years, and live out your dream travel plans when you retire?

Creating a financial plan that aligns with your goals and incorporates savings milestones could be an effective way to stay motivated and monitor your progress.

Not only could this help you recognise your achievements and reward yourself for hitting your savings goals, but it may also allow you to act quickly if you start veering away from your financial plan.

However, understanding your future financial needs and devising a strategy to meet them may not always be straightforward.

A financial planner can use cashflow modelling to help you assess your financial situation and create a plan for achieving your goals. This could set you on the right path for building a healthy nest egg.

2. Pay yourself first

“Paying yourself first” can be a useful strategy for turning regular saving and investing into a habit.

It means treating contributions to your pension, savings, and investments as essential bills.

One simple way to achieve this to set up automated savings so that each month you transfer a percentage of your earnings into your pension, savings, or investment accounts.

Planning ahead in this way could allow you to build a habit of investing regularly. 

Thanks to the positive effects of compound growth – earning returns on your returns – investing regularly is one of the simplest ways to build your nest egg.

Also, investing little and often could help you benefit from the highs and lows in the market while reducing the effects of stock market volatility, through “pound cost averaging”.

Read more: 5 great ways young and old can profit from regular investing

3. Make use of tax-efficient allowances

As well as thinking about how you can save regularly, it’s important to consider where to build your nest egg.

ISAs offer a tax-efficient place to hold your savings and investments. Any interest or dividends you receive from an ISA are free from Income Tax and you won’t pay Capital Gains Tax (CGT) on any profits you make from your investments.

In the 2023/24 tax year, you can add up to £20,000 into either a single ISA or multiple different types of ISA. For example, you might choose to put £10,000 into a Cash ISA and £10,000 into a Stocks and Shares ISA.

Currently, you can’t pay into multiple ISAs of the same type during a single tax year. However, from 6 April 2024, multiple subscriptions to ISAs of the same type, as well as partial transfers, will be allowed.

Additionally, in the Spring Budget on 6 March 2024, the chancellor announced that the government plans to create a British ISA, which could allow you to invest an additional £5,000 each year tax-efficiently in UK funds.

The British ISA is under consultation until 6 June 2024, and it’s not clear when it may be introduced.

It’s important to note that your ISA allowances reset when a new tax year starts. So, any of your £20,000 ISA allowance that remains unused by Friday 5 April 2024 will be lost.   

If you don’t want to find additional cash to top up your ISA before the tax year ends, it might be worth exploring a “Bed and ISA” strategy to help you take advantage of your full allowance.

Read more: “Bed and ISAs” explained: Is it a good investment strategy for you?

5. Don’t put all your eggs in one basket

While cash savings can offer valuable peace of mind, and keeping an emergency fund for unexpected events is wise, relying solely on cash for long-term savings may not be the most lucrative option.

Over time, your cash savings could diminish in real-term value as inflation rises – according to This is Money savers lost twice as much to inflation in 2023 as they earned in interest².

Conversely, investing your money could deliver higher returns long term. So, spreading your “eggs” between savings and investments baskets may be a smart move.

Additionally, diversifying your investment portfolio by investing across different asset classes, sectors, and geographical locations, could spread your exposure to risk.

You might also benefit from exploring alternative savings accounts periodically. Rather than sticking with the same account by default, shopping around could help to ensure that your cash savings are earning the best possible interest.

If you’re not sure how to get started with investing or would like to understand more about ways you could diversify your portfolio, a financial planner can help. They can also review your savings strategy and create a bespoke financial plan to guide you towards building the nest egg you need to achieve your goals.

Get in touch

If you’d like to know more about how to build a savings nest egg, we can help.

Please email us at info@aspirafp.co.uk or call us on 01454 632 495.

Please note

The information contained in this article is based on the opinion of Aspira and does not constitute financial advice or a recommendation for any investment or retirement strategy.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate cashflow planning or tax planning.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. 

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

¹ https://www.money.co.uk/savings-accounts/savings-statistics

² https://www.thisismoney.co.uk/money/saving/article-12679929/Inflation-de...

286 - 03 2024

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