That’s why I always put time aside to look at another type of egg – your nest egg (I know and I’m sorry!). While many at this time of year are heading to church, staying home and/or looking for deliveries from the Easter Bunny himself, we should also take time to focus on creating – or improving – our finances.
Why would Easter prompt a savings review?
Apart from the obvious and tenuous ‘nest egg’ link, spring really is the time to look at what we have, what we would like and how we can get there.
I’m sure most of us have started spring cleaning our homes (mainly due to the sun finally turning up and just showing off the dust!) and this is just an extension of that. Your home always feels better after a spruce, so why shouldn’t your finances?
Interestingly (or not!), the term ‘nest egg’1 derives from the 14th century and refers to putting an artificial egg into a nest to encourage the hen to lay. This then led to some homes having china hens where you would put your money, hence building a sum of money for future use. So where should you start?
Start small with your savings
You don’t need to have a golden goose to start a nest egg; putting small sums of money into an account will build up. Some banks and building societies have a ‘save the change’ option where your bill can be rounded up and the change goes into savings
Likewise, many use the ‘PAD’ way of savings. By making a ‘payment a day’, it all builds up – and again, it doesn’t have to be large amounts.
A great way to start is to go through your own expenses; is there anything you can reduce the cost on? Any subscriptions you no longer use? Soon enough, you could find yourself with £50 a month to save, which is only about £1.64 a day. Putting this into an Individual Savings Account (ISA) or even towards your pension planning may not seem much; however, over time and thanks to compound interest, your money could grow to substantial amounts.
Where should I save my investments?
Back to the Easter theme. We’re all familiar with the phrase ‘don’t put all your eggs in one basket’ and this is true with savings. By diversifying across different kinds of investments, you can potentially protect your nest egg from market volatility.
Depending on how much you can save, consider putting your savings into cash and/or stocks and shares ISAs. Current rules state you can save up to £20,000 per tax year in one of these tax-free wrappers.
However, you cannot roll over any unused allowance from one tax year to the next, so it’s important that you use it or lose it.
You could even look at putting money into your pension. Take time to look at your retirement goals and your attitude to risk and see what you need to do to make your dreams happen.
It’s important to remember that a diversified portfolio offers different protections and benefits, so it could be worth discussing your savings plan with a financial adviser.
The power of patience
Easter follows Lent – a period traditionally associated with patience and delayed gratification. These are qualities that should be accepted with financial planning.
Anyone can invest but the most successful investors are often those who spend time in the market rather than timing the market.
Allow time and compound interest to enable your finances to grow.
Think about your retirement planning
For many of us, the ultimate nest egg is your pension. Preparing for retirement is just as important – if not more – than saving for your first home or taking that extra holiday each year.
Retirement requires an early start, allowing your funds to grow over time. For some, a pension is just a deduction on your payslip but with expert guidance, you could see yourself with a nest egg to see you through for many years after you stop working.
Currently, you can access your private pension from age 55 (increasing to 57 in April 2028), with the State Pension not kicking in until at least age 66.
To make the most of your money, consider maximising your pension contributions, especially if your workplace provides employer matching contributions. This is essentially additional money you can earn, so it’s a bit like finding an extra Easter egg you’d forgotten about.
Educating our children
Easter can be a time when families get together, providing a fantastic opportunity to start teaching the younger generations some financial acumen. Consider using the time hunting for those eggs to introduce the idea of saving and investing.
Why not play a game where if they save their Easter egg until after dinner, it will grow into a bigger egg? This shows them the value of saving and investing time in their future (plus you get the smaller egg to eat when the kids are in bed!).
A recent article by MoneyHelper2 suggests children start learning about money from the age of five, while their relationship with it starts at around seven.
Starting a Junior ISA (JISA), or even a childhood pension, can help your children in the future, with several tax reliefs such as tax-free growth being available.
Spring cleaning your finances
It’s easy to talk about starting savings accounts but what if you already have some? First of all, that’s great! Secondly, have you reviewed them recently?
With the Bank of England base rate changing, it’s important you make sure you’re getting the best interest on your savings.
While a lower base rate can help with mortgages and loans, it can be tough on your savings. A quick search on the internet can bring up several companies that are providing higher rates for savers.
And if you’re a loyal bunny, look at your financial provider’s offerings, as there could potentially be a higher interest account on offer.
It’s also important to assess whether your savings are still in keeping with your goals. You may have built an emergency fund and now you have need of a new goal.
Maybe your savings are on target, but you have a small amount of extra cash. You could add this to your pension contributions or start looking at protective measures such as critical illness cover or life insurance.
Book six-monthly meetings with yourself to review your finances and you’ll be surprised what you can achieve.
Seek expert financial advice
It’s easy to get lost in the myriad of financial offerings out there. Perhaps you’re not overly confident in that area, or maybe you already have a nest egg following an inheritance, divorce or redundancy. Whatever the reason, it could be worth talking to a financial adviser.
At Mattioli Woods, our financial advisers will work with you to ensure you’re making the most of your tax allowances, investing appropriately for your goals and ensuring you maintain the right balance between enjoying today while saving for tomorrow.
1 https://www.merriam-webster.com/dictionary/nest%20egg
All content correct at time of writing (April 2025).
