How your daily £1.75 spare change could grow into £12.4k pot in just 10 years without you even noticing

YOUR spare change could be quietly growing your savings into a hefty pot worth THOUSANDS. Several banks now offer ’round-up’ features that let you save small sums of cash into a savings pot every time you spend. They work by automatically rounding up each transaction to the nearest pound, and then adding the extra into your savings pot. The idea is that you’ll barely notice the cash leaving your account. Sign up for the Money newsletter Thank you! Moneybox data suggests Brits save an average of £12.37 a week using round-ups – that’s around £1.75 per day. If you did that for 10 years, you could end up with a maximum savings pot of £12,400 – depending on whether you chose to invest your money or put it in a savings account earning interest. You could put that towards a house deposit, a brand new car or a dream wedding, and you would’ve saved up without even having to lift a finger. Rajan Lakhani, personal finance expert at Plum, said: “These figures show how powerful automated tools like round-ups can be… “These small amounts add up over time and can make a major contribution to your savings stash, especially if you put your money to work in either savings or investments. Otherwise, the benefits won’t be as powerful and you could find the value of your money eroded by inflation.” Here’s how each of the round-up features work… Most read in Money Plum Plum is a smart money app that helps you save by using automated features Credit: Alamy Smart money app Plum can be linked to your main bank account. It has multiple automated saving features, including AI-powered analysis that calculates and sets aside affordable amounts based on your daily spending behaviour. The Round-Up feature automatically rounds up each transaction to the nearest pound and adds it to a savings pot. For example, if you spend £4.50 on coffee then Plum will round it up to £5 and send that 50p into your savings account. You can put the cash into an easy-access ‘interest pocket’, which pays around 3% in interest. The money will be paid into your savings pot weekly. Some transactions aren’t eligible for round-ups, including bills, housing, cash withdrawals and fees. If you deposited the average amount of £1.75 each day over 10 years, you would’ve amassed a savings pot worth a huge £7,442. That includes around £1,050 worth of interest. To set up the Round-Up feature, go to the Automations section on your Plum app and then switch on Round-Ups. Moneybox Moneybox lets you pay your spare change into a Cash ISA, Simple Saver or Stocks and Shares ISA Credit: Alamy You can also connect your bank account or credit card to the Moneybox app. Moneybox will round up your transactions to the nearest pound and send your spare change to whichever account you choose to connect. This could be its Cash ISA, Simple Saver, or Stocks and Shares ISA. The Cash ISA pays 4.52% in interest, while the Simple Saver pays 3.4%. It’s usually better to go for a Cash ISA as the interest you earn will be tax-free – but you can only put a maximum of £20,000 into ISAs over the tax year, so make sure you won’t hit the limit. Once you’ve connected your bank account, your transactions will be rounded up automatically two days after you spend. If you’d prefer to choose which transactions to round up, you can turn off the automated setting. You can then either swipe right on a transaction to round up, or swipe left to dismiss. Your savings will be deposited into your chosen account weekly. If you deposited £1.75 per day into the Cash ISA, which has an average interest rate of 4%, you’d earn £7,842 over 10 years if the interest rate staid the same. But if you deposited it into a Stocks and Shares ISA, it could earn much more. If you invested in the Fidelity World Index, which has a past return of 13%, through your ISA then you could end up with £12,460 before any fees are deducted. Of course, just because an investment has done well historically doesn’t guarantee how well it will perform in the future. Trading 212 Trading 212 could help you boost your spare change further by letting you invest Credit: Alamy You could boost your spare change savings even further by investing them. Generally, you’ll earn more in the long-term from investing your cash than putting it into a savings pot. For example, the S&P 500, which holds shares in the top American companies, has historically generated average returns of around 7% after accounting for inflation. That’s much higher than a savings account paying between 3% to 4%. Trading 212 has a Spend & Invest feature that lets you automatically invest spare change or cashback from card purchases into a chosen stock, ETF, or “pie”. So whenever you make a purchase with your Trading 212 card, you can round up the amount to the nearest pound and invest the difference. “Pies” are custom portfolios on Trading 212 that group multiple stocks or ETFs into one investment. You can either choose to build your own pie and choose how big a “slice” each stock should make up, or you can choose a readymade portfolio. Trading 212 also lets you apply multipliers so you can boost the spare change amount saved by up to five times. To enable the feature, go to your favourite stock, ETF or pie in the app. Go to the Spend & Invest section and enable Invest Spare Change. If you invested £1.75 per day over 10 years with an average return of 7%, you’d end up with £9,218. Revolut Digital bank Revolut has lots of different options for saving away your spare change Credit: Alamy Revolut also gives you multiple options for how you want to use your spare change. The digital bank has a spare change feature that lets you put your extra change into a Revolut Pocket or savings account, or you can use it to purchase cryptocurrencies or earn RevPoints. Revolut Pockets are essentially savings pots that are separate from your main account, however they don’t pay any interest. If you put £1.75 into a pocket each day over 10 years, you’d have £6,391. Meanwhile, a savings account would pay between 2.9% to 4% in interest, depending on whether you have a paid subscription or not. With a standard Revolut plan, which you don’t have to pay for and gives you 2.9% in interest, you’d end up with £7,395. But if you pay for the Ultra plan, which costs £55 a month and gives you 4% in interest, you’d have £7,842. Cryptocurrency is a digital form of money that uses virtual tokens or coins. You could use the spare change feature in your Revolut account to buy a cryptocurrency of your choice – this is essentially an investment. Just be aware that crytocurrency can be volatile and is generally riskier than other forms of investing. Another option is to convert your spare change into RevPoints, which is a loyalty programme with Revolut. You’ll be able to exchange points for airline miles, which can get you free or discounted plane tickets, or for discounted hotel stays, experiences and shopping. To enable the spare change feature, go to Accounts on your Revolut app. Then choose your pocket or savings account, scroll down and enable the ‘Spare Change’ toggle. Comment now