Monzo disclosed that the highest amount saved by a single customer using its roundups feature is around £45,000. Roundups work by rounding up each card payment to the nearest pound, with the spare change automatically moved into a digital savings pot.
On average, Monzo customers save approximately £109 per year through roundups. Similar roundup features are offered by banks like Chase, Starling, NatWest, Lloyds, RBS, Halifax, TSB, and Revolut.
These new statistics coincide with the approaching ISA deadline. Each tax year provides a £20,000 allowance that can be allocated across various ISAs; any unused portion is forfeited as it cannot be carried over.
As the tax year concludes on April 5, now is a good time to assess if your savings are optimized. Different saving methods are available, depending on your circumstances and financial goals.
To provide insights into maximizing savings, Joanne Phillips, General Manager (Wealth) at Monzo, advised starting with setting up simple strategies like roundups. Furthermore, she emphasized the importance of smart money management, such as using features like the salary sorter to allocate funds effectively.
Joanne recommends establishing an emergency fund equivalent to three to six months’ worth of essential expenses. Beyond that, considering short to medium-term savings for purposes like holidays is essential. For longer-term savings, she suggests utilizing cash ISAs and stocks and shares ISAs in a layered approach.
Starting from April 2027, the cash ISA limit for individuals under 65 will be reduced to £12,000, while the overall ISA limit remains at £20,000.
Labour anticipates this change will encourage more people to invest in stocks and shares. Joanne highlighted the importance of educating the public about these alterations to enhance saving and investment behaviors.
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