If you’re a spender, chances are that you can’t help your impulsive shopping sprees, impromptu dinner dates with friends and just have to have that shiny new thing you see in the display window. And with no restraints on all this spending, are you faced with guilt and disappointment at the end of the month when your account balance is right where it was the previous month?

It’s easier to avoid dipping into your savings if you have an actionable saving strategy planned out for yourself – something that’s not too restrictive but at the same time pushes you to save regularly in a disciplined manner. Below are a few tips that can help you protect your savings from yourself.

Tie-up all that extra money in a savings/deposit account

If you can’t help withdrawing money frequently from your current account, especially for your unplanned impulsive buys, start saving in a separate savings or deposit account. A savings account will limit your withdrawals, while a deposit account will have your money tied-up for a fixed tenure with a penalty on returns if you withdraw sooner. But isn’t that the whole point, to save money at the end of the day?

Souqalmal.com’s recent analysis showed that you can earn an average annual return of about 1% in deposit accounts and 0.60% in savings accounts in the UAE. And the added interest/profit income will most definitely help boost your savings pool in the long run.

If you’ve already accumulated some cash in your current account that you don’t need in the near future, you can transfer and save it in deposit account like the HSBC Term Deposit which can earn you an interest rate of up to 1% p.a. based on the term and amount of your deposit.

[Related: Average returns of up to 1% p.a. on UAE bank accounts]

Set clear savings goals to help you stay motivated

It’s easier to save when you have a pre-defined saving goal and timeline to achieve it. When your aim is to just save for the future and you don’t have a target or finish-line in mind, you’re likely to go astray when it comes to sticking to the saving plan. But let’s say you’re saving for your retirement fund or an education fund for your children, or even for a dream vacation, you will save more religiously. And putting a number and a due date to these goals will definitely keep you motivated. So if your aim is to save AED 120,000 for your child’s college fund and you give yourself 10 years to achieve this goal. Saving AED 1,000 per month in a current account or AED 971 per month in a savings account (earning 0.60% p.a.) will get you there easily.

Here’s a look at how much you would have to save per month in your regular current account vs an interest-earning savings account, to meet a savings goal of AED 120,000.

Rate of Return Saving Period
(per annum) 10 years 5 years 2.5 years
Current Account 0% AED 1,000 AED 2,000 AED 4,000
Savings Account 0.30% AED 985.2 AED 1,985.3 AED 3,985.6
Savings Account 0.60% AED 970.6 AED 1,970.7 AED 3,971.1
Savings Goal – AED 120,000

Have a separate emergency fund to avoid using your savings

Emergencies and unforeseen expenses may catch you off-guard but you can avoid dipping into your savings if you have a separate emergency fund in place. If you do use your emergency fund, make sure you replenish it. This may slow down your regular savings for some time, but at least you’re not touching your accumulated savings. See the link below to know more about emergency funds.

Emergency fund – Are you prepared for the worst?

And if you can’t decide between opening a savings account or deposit account, you can opt for the HSBC eSaver Account which combines the best features of a Savings Account and a Term Deposit, as it allows account holders to earn a higher return than a regular savings account, while still retaining the flexibility to withdraw money from the account once per month, without any loss of interest.