I’ve scoured the list of the largest FTSE companies that have raised their dividends every year for at least five years, and have also seen their share price rise over the same period.

It wasn’t an easy task.

Of the largest UK public companies, only a handful meet this strict criteria.

Growing dividends at the same time as growing profits is an exceedingly difficult thing to achieve.

Why? Well, if a business commits too much of its free cash flow to paying out dividends to shareholders, that money can’t be used to expand its business. It also can’t use that spare cash for investing in new technology or acquisitions. These moves can often boost revenues or profits.

But the companies that manage the task are going straight to the top of my watchlist. If I want to have enough cash to retire, I’ll need an ISA or SIPP stacked full of these compounding giants.

Growing by buying

Bunzl (LSE:BNZL) is not the kind of flashy stock beloved by forum posters who debate its price day in and day out. But it is a consistent and predictable profit-making machine.

The £10bn FTSE 100 industrials company sells its products in more than 30 countries. These products include medical gowns, disinfectants, and food packaging. By themselves, these may goods with low profit margins. But they make Bunzl an incredibly important supplier for thousands of businesses worldwide.

Bunzl also has a successful acquisition strategy, spending £4.5bn to buy up more than 190 smaller businesses since 2004.

Since 2017, net profits — also called a company’s “bottom line” — have grown by 90%.

So let’s talk about the dividends on offer here. WIth a share price of 2,492p at time of writing, and four payouts a year of 57.72p, that works out to a 2.15% dividend yield. It’s not a king’s ransom by any stretch.

But Bunzl has grown its payouts to income investors for more than 23 years! The share price is also 40% higher in the last five years.

While this is unlikely to light anyone’s world on fire, it has been consistent and predictable. For me, that’s crucial. I’ve wasted enough money on illiquid, lottery-ticket stocks to know the difference between promises and results.

Long-term strategy

As a long-term compounding growth investor I want to avoid FTSE companies with patchy or inconsistent records.

I have to think like Warren Buffett and remember that I’m buying a business — not just a story. This is in my mind every time I invest in dividend stocks and shares.

That high share price of almost £30-a-pop may put off newer or younger investors who are used to being able to buy fractional shares in low-cost broker accounts. I could consider this a downside, as it may deter fresh capital from coming into the business.

But as we heard from HMRC in October 2023, fractional shares don’t qualify for the tax advantages of being held in an ISA.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

I’m focused on steadily growing my net worth over the next 15 years or so before I retire. I’m not a joyless automaton, but I’ll leave my gambling to the odd bet on the football rather than risking my retirement cash.

The post FTSE dividend hero alert! I think I can retire on these UK shares appeared first on The Motley Fool UK.

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Tom Rodgers has no position in any of the shares mentioned. The Motley Fool UK has recommended Bunzl Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Investing via the stock market is often labelled as ‘risky’. But I’m happy to take that risk rather having a lot of my wealth sitting in a cash savings account. Allow me to explain why I’m buying UK shares.

Cash savings erode in value

Let me start by clarifying that I’m not against setting some money aside. I actually reckon this is very prudent. Having cash ready for replacing something that’s broken down in the house, for example, can take a lot of the sting out when it (inevitably) happens. 

Once I’ve reached a certain amount however, the benefits that come from keeping my wealth in this asset diminish massively. The reason for this is that inflation — the ‘silent killer’ of the financial world — gradually (or not so gradually) erodes the value of money.

Inflation isn’t always a bad thing. However, anyone with an eye on the headlines can’t have failed to notice the rising cost of living in recent months. In fact, inflation sat at 5.4% in December, far above the Bank of England’s 2% target. The state of affairs is even worse across the pond. At 7.5%, inflation in the US is now at its highest rate since 1982. 

Since any cash savings I have are now being  impacted, I think it’s wise for me to keep less money in the bank and more in the stock market. There are a few reasons for this.

Why I’d buy UK shares instead

First, equities have been shown to generate higher returns than all other traditional asset classes over the long term. So even though inflation may have the upper hand right now, this is unlikely to matter if I can lock my money away in the market for years (and ideally decades). True, past performance is no guide to the future, but nor is it completely redundant, in my opinion. 

A second reason relates to the valuation of stocks. Whether we attribute this to the pandemic, Brexit, supply chain issues and/or tensions between Russia and Ukraine, many UK shares are very reasonably priced at the moment. As Warren Buffett would attest, the best time to buy is when brilliant companies are on sale.

Third, owning UK shares gives me access to a source of passive income in the form of dividends. Yes, not every company returns a proportion of profits to shareholders. However, those that do can serve as a defence against rising prices.

Get personal

Of course, the above is conditional on me having already built up the aforementioned cash buffer. I’d also not want to be carrying any debt (aside from a mortgage). Yes, inflation is high, but the interest I’d be paying on credit cards is even worse.

It’s also worth bearing in mind that the specific UK shares (or funds) I buy will be dependent on a number of other factors that vary between investors. As someone in his early 40s, my portfolio may not have the same asset mix as someone in their early 20s, or a retiree.

Investing is very personal. Therefore, it’s vital to evaluate my own risk tolerance, financial goals and time horizon before I buy anything with the cash I move over from my savings account.

The post Cash savings accounts? I’d rather buy UK shares as inflation soars appeared first on The Motley Fool UK.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Dividends: made for spending?

Clearly, spending cash received from one’s investments will be a necessity for some. Those who are retired, for example, may need to use the extra income to boost their pension(s) and provide for a more comfortable standard of living. The bi-annual or quarterly cash payments can also be a source of comfort for those who are suffering from long-term health complications and perhaps are unable to work. Dividends can be a saviour during an unexpected period of unemployment as well. 

And let’s not beat about the bush here: 2020 was a painful year for, well, everyone. The global pandemic served as a sober reminder that life is both fragile and finite. Having money provides security but it should still serve an instrumental purpose. It’s there to be used not admired, at least in my view. Having taken on the risk of owning stocks, some controlled spending can therefore be rationalised. A holiday here, a new (insert product of choice) there. Fair enough.

That said, I also believe in assessing what I might be sacrificing by spending what I receive. Call it FOMO, investing-style. For me, this changes everything.

Time is money 

As a sprightly 40-something (OK, that first bit is an exaggeration), I’m hoping to stay in the markets for a good while yet. Knowing this, I’m aware that I stand to benefit the most from compounding — essentially, interest on interest — by keeping my money in the stock market.  

There’s no need to get wrapped up in complex calculations here. The more shares of great dividend-paying companies I own, the more cash I receive (although this income is never guaranteed). The more cash I put back into buying great stocks, the more I ultimately benefit from compounding. Think of it as a snowball rolling downhill, gradually increasing in size.

This reasoning explains why I’ve not spent a single penny that’s been sent my way since I first opened a Stocks and Shares ISA many years ago. Instead, it’s either gone straight back into buying shares or temporarily held in preparation for the next correction or crash. By the way, I think we’re due one of the latter before too long.

As things stand, my stance is at one extreme. There’s no rule to say I can’t spend some of the cash and reinvest the rest. Indeed, this is probably what I’ll do as the years pass.

Have a plan

Whether dividends are spent, reinvested or a mixture of the two will depend on an investor’s personal situation — their financial goals, risk profile and time horizon.

My ‘arrangement’ works for me. It might not work for others, of course. Just as two people can reach different conclusions about the same stock, we can also disagree about what to do with the money it pays out. Importantly, neither of us will be wrong as long as we do what’s right for us as individual investors.

And isn’t having a plan for what to do with dividends far better than not having one at all?

The post Should I reinvest my dividends or spend them? appeared first on The Motley Fool UK.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Today, however, I’m picking out 10 top-tier stocks that I’d feel comfortable buying now and holding until 2030.

Defensive demons

Although the near-term may present challenges to even the most resilient, globally-diversified companies, firms such as Unilever and Diageo should emerge relatively unscathed. 

Even if the panic-buying witnessed over the last few weeks is (thankfully) unlikely to last, it’s clear that consumers will continue to prioritise spending on food and household items for the foreseeable future.

With a portfolio bursting with brands such as Persil and Dove, that should keep earnings relatively steady at Unilever.

The same goes for Diageo. Despite the enforced closure of pubs and bars, there will still be plenty of drinking going on at home. And when this is all over, the desire to socialise over a beverage or two will surely return in force.

Power provider National Grid is another stock I’d consider buying. As dull as utility stocks are, they do have a habit of holding their own during troubled times. They’re also a fairly safe choice for income hunters. Right now, the Grid yields 5.4%.

Healthcare heroes

Aside from those with great brands, there are other stocks — most notably related to healthcare, safety or hygiene — that could make great investments over the short and long term.

With its 5.4% dividend yield, GlaxoSmithKline would be my preferred pick in the pharmaceutical space. Medical devices manufacturer Smith & Nephew looks good too, especially as it only revealed market-beating revenue and profits back in February. The hip and knee implant maker might also be a good play on the longer-term ‘ageing populations’ theme.

Despite their still-frothy price tags, safety product maker Halma and pest control firm Rentokil Initial would likely make the cut too. I can’t see demand for any of their services drying up. Indeed, I think it will be the opposite!

High quality

My remaining picks are more cyclical. However, what they may lack in traditional defensiveness, they more than make up for in quality. Again, adopting a long-term perspective is vital here.

Like nearly all retailers, 164-year-old luxury brand Burberry has been forced to close stores across the world. Once the coronavirus has passed, however, I suspect its products will be as much in demand as ever, particularly in Asia. It may even become a takeover target. In the meantime, the company’s financials look robust, at least relative to sector peers.

While the extent to which the crisis will impact the UK housing market is unclear, I’d be eyeing up property portal Rightmove as well. Perpetually prohibitively expensive, the £4bn cap generates unparalleled returns on the money it invests. It’s also succeeded in protecting its massive market share for many years.

My final pick is not a single company stock at all. Tech-focused Scottish Mortgage Investment Trust gives exposure to high-growth giants such as US giants Amazon and Tesla.

Although the sector is prone to hype, the returns made by the trust over the last 10 years have been superb and far above that generated by the FTSE 100 (indicating that the trust’s managers are assured stock-pickers). As an existing holder, I’m hoping this will continue for the next 10 years.

The post Have cash to invest? Here are 10 FTSE 100 stocks I’d buy and hold for the next decade appeared first on The Motley Fool UK.

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Paul Summers owns shares of Burberry and Scottish Mortgage Investment Trust. The Motley Fool UK owns shares of and has recommended GlaxoSmithKline and Unilever. The Motley Fool UK has recommended Burberry, Diageo, Halma, and Rightmove. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

For what it’s worth, I’m also inclined to be more bearish than bullish right now. That said, I’m very aware that trying to predict the direction of markets, at least in the near term, is a waste of time.

What I can say without any hint of sensationalism however, is that a crash is coming. We just don’t know when.  

Regardless of timing, here’s how I’d deal with it. 

Be prepared

The best way to deal with a market meltdown is to anticipate it: get your finances in such a state that you know you’ll able to ride out any volatility without losing sleep. “Forewarned is forearmed“, as the saying goes.

Ultimately, this means checking that the way your money is allocated matches your risk-tolerance. Since they often fall the hardest, there’s no point holding just stocks if you panic at the first whiff of trouble.

Stocks should remain the core of your holdings, but a solution would be to increase your exposure to other assets, such as bonds, property, gold and cash. These are unlikely to give you a better result than equities over the very long term, but should help stabilise your portfolio in difficult times.

Tweet less, read more

This isn’t the place for a detailed analysis of the benefits and drawbacks of social media. Notwithstanding this, I do question the usefulness of sites like Twitter and Facebook (and reading highly emotive posts) during market crises. 

A solution for making it through a meltdown is to read more about how frequent they actually are. Aside from your regular dose of the Fool UK (naturally!), I’d recommend the writings of US psychologist Daniel Crosby — author of ‘The Laws of Wealth‘ — for this. Clearly, the classic thoughts of Warren Buffett and his teacher, Benjamin Graham, are always worth revising.

Ditch ‘the twitch’

A third recommendation is deleting anything on your phone relating to your investment account(s).

Since we’re long-term investors, compulsively checking your holdings through mobile apps is counterproductive but particularly so when the next crash happens. “A watched pot never boils” can be adapted to “a watched pot never boils but continually fretting over your portfolio can breed unnecessary action and reduced returns“. Not quite as catchy, but you get the gist. 

If you’ve done the groundwork to get things in order, you should be able to stay logged off until the storm passes. 

Get a watchlist

Having prepared yourself for the worst (and with cash on hand), you can now take steps to profit from a crash as and when it happens. For me, this starts by drawing up a list of stocks I’d want to buy on any share price weakness. 

To be clear, buying when everyone is selling sounds easy in theory but is very difficult to do in practice. Faced with financial ‘apocalypse’, it’s remarkably easy to forget that stock markets chug higher over time, despite enduring similar crises in the past. 

Should you be able to rise to the challenge, however, you can be confident that the end result will be worth holding your nerve for.  

The post Do you fear a market meltdown? Here’s what I’d do appeared first on The Motley Fool UK.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Here are just five to be wary of.  

1. Constant vigilance

Truth be told, there are very few things you can control as an investor beyond how much of your money you put to work and what you choose to buy. That doesn’t stop many from tracking every percentage point move in their portfolios.

Clearly, adopting a ‘buy and completely forget’ mentality when it comes to investing isn’t advised, but nor is constantly checking your investments every hour of every day. The latter can lead to unnecessary actions being taken, the costs of which mount up and dent performance.

If you find yourself logging in with alarming frequency, it may be worth questioning whether your holdings truly match your risk appetite. 

2. Holding too much cash

Just as being too vigilant when fully invested can be counter-productive, so too can sitting on the sidelines waiting for a crash before putting your money to work. As the old adage goes, it’s time in the market not timing the market that matters. 

There’s nothing wrong with holding some cash in reserve, of course. Just be aware that the longer you refrain from investing it, the greater the drag on your returns will be. A better solution might be to take advantage of pound cost averaging. 

3. Comparing your returns to others

Countless psychological studies have shown that our level of happiness doesn’t increase much after we achieve a certain level of income, even if the latter continues to rise. What’s more important — but ultimately a waste of time — is how we perceive our success compared to that of our peers.

It’s worth remembering this when investing, particularly as social media is littered with people boasting of their winners (and usually staying quiet about their losers).

Don’t waste time wishing those gains were yours — the only portfolio that matters is your own. 

4. Reading bulletin boards

It’s easy to become attached to stocks we hold. Therefore, checking in with more bearish views via a public forum sounds good in theory.

Unfortunately, bulletin boards have a habit of attracting people whose sole intention is to make money through manipulating others. Those wanting to buy a stock as cheaply as possible might, for example, post lots of negative comments about a company from multiple accounts in the hope that others will sell in a panic.

The message here is simple: don’t base any investment decisions solely on something you’ve read on a forum from someone you don’t know. Spend more time doing your own research.

5. Building the ‘perfect’ portfolio

Countless articles have been written on the subject of asset allocation — namely, how much of your money you should put into shares, bonds, gold, property and so on based on things like your age and attitude to risk.

While clearly an important consideration, the fact that opinions vary indicates this isn’t — and never can be — an exact science.

Don’t obsess whether you hold, say, 70% or 71% of your capital in equities — just go for a ‘good enough’ approach that matches your needs as closely as possible and allows you to sleep at night. 

The post 5 big investing time-wasters that will stop you from becoming rich appeared first on The Motley Fool UK.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Perhaps I should be more specific. In saying that saving money is a less-than-optimal strategy, I’m merely suggesting that using any kind of cash account for this purpose won’t do your finances much good. Here are three reasons why.

1. Interest rates are staying low

The level of interest offered by cash accounts has been historically low for a long time now. Thanks to ongoing jitters over the global economy, I can’t see this situation changing radically over the next few years, let alone in 2020. News last week that one of the largest banks in the UK, Santander, will reduce the interest it pays those holding its popular 123 current account (from 1.5% to 1%) speaks volumes.

For me, this makes it even more of a priority than usual to pay down any high-interest debts before thinking about saving a single penny. This is particularly relevant in January as many of us will have splurged on credit cards over the festive season.

Dealing with a financial hangover sooner rather than later is always the best solution.

2. Inflation erodes value

Aside from having a fund for life’s emergencies (such as replacing a broken boiler), I’d keep as little of my savings in cash as possible for another reason other than the fact that the interest paid can’t match that charged on any debt.

Inflation — the rise in the cost of goods and services over time — isn’t known as the ‘silent wealth killer’ for nothing. True, it may have fallen to its lowest rate for more than three years in December (1.3%, according to the Office for National Statistics) but this is still higher than the interest offered by the vast majority of Cash ISAs or bog-standard current accounts. This means the value of any saved cash isn’t growing at all. In most cases, it’s actually losing its buying power.

To make matters worse, the fact that current inflation is lower than the 2% targeted by the Bank of England could force another rate cut later this month, which would be more bad news for savers.

3. Stocks pay you

It won’t come as a surprise that I believe the best place to put whatever wealth you have is the stock market, particularly if you have no plans to retire just yet. Research has consistently shown that equities provide the best returns over the long term. Cash, by contrast, is the worst-performing asset.

Owning stocks in established, profitable companies should ensure your money grows above inflation, but another big attraction to investing is that many listed businesses pay out a proportion of their profits to their owners on a regular basis.

Although simply buying the highest-yielding shares should be avoided (this is usually an indication that the dividend is likely to be cut), those investing in some of the UK’s biggest stocks can still pick up yields of between 4%-6%. Compare that to the paltry rates offered by cash accounts and the decision is a no-brainer, in my view.

The post 3 reasons I’d STOP saving small amounts of money in 2020 appeared first on The Motley Fool UK.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Fortunately, this simply isn’t true; even £100 can go a long way if you give it time. Before giving my thoughts on what to do with this money, however, I should mention that I’m taking a few things for granted. 

Some assumptions…

The first is that you’re already debt-free. If this isn’t the case, stop reading after the next sentence. Mortgage aside, debt should always be prioritised over investing, especially if the rate of interest you’re paying is high.

The second assumption is that you already have a bit of cash put away for an emergency or two. Lots of personal finance gurus suggest between three and six months of expenses. I’d simply shoot for a figure that allows you to sleep at night.

Third, you should already have a Stocks and Shares ISA or Self-Invested Personal Pension (SIPP). If not, you need to know that opening at least one of these accounts is a priority. 

Done. Now, what should I buy?

It can be tempting to jump into individual company stocks when beginning to invest. That might be appropriate if you’ve got a few thousand pounds to spend but it’s less optimal when you’re working with £100 since a significant portion of that money will be gobbled up by the costs of buying. 

By far the best strategy, in my view, is to put that cash to work in a fund that tracks a market index. An index is like a league table of companies according to their market value; the more valuable a company is, the nearer the top it will be. The FTSE 100, for example, contains the biggest companies in the UK. By tracking it, you’ll generate about the same return as the index.

The explosion of interest in this way of investing over the years means there now exists a huge variety of such funds to choose from; there are indices that track multiple markets, bonds, the gold price, even companies that specialise in autonomous vehicles. This allows you to spread your cash around, making it a good option for those who lack the time, energy, or inclination to thoroughly research individual companies. 

Don’t take my word for it. Legendary investor Warren Buffett thinks the vast majority of people would be best off buying shares in a fund that tracks the market rather than attempting to beat it. I’d say he’s worth listening to. 

From little acorns…

Let’s say you put that £100 to work in a fund tracking the FTSE 100 and did nothing for 30 years.

Based on an achievable 7% annual market return (and not taking into account costs or fees), that £100 would turn into £761, according to my calculations. If markets did even better (or you chose to invest in a fund that tracks the returns of, say, much smaller companies) and generated a 10% return on average over the same period, you’d have £1,745.

Sure, these numbers are hardly life-changing. They do, however, show what can be done with a small amount of cash that’s allowed to compound over time. Think of what could be achieved if you were able to put some extra cash aside every month!

The post How I’d invest £100 right now appeared first on The Motley Fool UK.

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• Meet the 9.6%-yielding income share that could keep growing its payout!

Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Thanks to the power of compounding, doing this vastly increases your chances of becoming financially independent earlier in life and/or securing a more comfortable retirement.

The only catch is, you need to get your spending under control first. So here are four ways of doing just that. 

1. Practice patience

Instead of buying something impulsively, why not just make a note to consider purchasing it after a set period instead? This could be a month, a week, or even just 24 hours. If you’re shopping online, set up a wishlist and come back to it later.

This simple action isn’t intended to cut out all the joy in your life. But it does allow you to recognise your spending ‘triggers’ and the breathing space to consider whether you really want, or need, a product.

It also gives you the time to check whether you might be able to get a better price for that ‘special’ something elsewhere. Or perhaps a friend might already have what you want and would be prepared to let you borrow it. They may even want you to take it off their hands for free!

2. Ditch the plastic

Thanks to credit cards and innovations such as Apple Pay, we’re using less cash than we used to. Being able to ‘tap and go’ without having to look through your wallet for notes/change is, of course, very convenient. But it also has the potential of making living below your means that little more difficult, because you’re less likely to track your outgoings. Studies have consistently shown that people become more conservative with their spending when they use real money rather than cards.

The key here is having a plan and sticking to it. Consider your weekly food shop. Why not decide on what meals you will cook in advance, withdraw a set amount from your bank account and then use this (and only this) for your groceries? If you feel comfortable doing so, leave your cards and phone at home. 

3. Pay yourself first

One of the best ways to ensure you’ve got money to invest is to transfer said money over to your Stocks and Shares ISA, or SIPP, as soon as your monthly salary hits your bank account. Better still, set up a direct debit so the process is automated.

In addition to now having cash to put to work in the market, this means you’ll have less to spend from the off (although this does involve you also abiding by the points above). Just to make sure, think about ditching any overdraft facility your bank may offer too.

Another option

If you’ve tried all of the above, have cut back where you can, and still have no money left over, a final option is to find ways of earning more, be it through a promotion or a second income stream. The latter could take many forms. Tutoring someone else on a subject you enjoy, or selling things online are just two examples.

The obvious drawback here, however, is that you need to be even more disciplined to refrain from spending this extra income.

The post 3 ways to stop spending all you earn appeared first on The Motley Fool UK.

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• Here’s how Britons can invest in SpaceX on the FTSE 100
• The BT share price is on fire in 2026. Is there still time to buy?
• These 2 Stocks and Shares ISA buys are on fire in 2026
• More oil wobbles as the BP share price dives 7% in a day!
• Meet the 9.6%-yielding income share that could keep growing its payout!

Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Cash savings

For my day-to-day bank account, I use a Santander 123 account. I also use this account as my ‘emergency fund’ meaning I keep enough money in it to cover around three months of expenses.

The advantage of this account is that it pays interest of 1.5% p.a on balances up to £20,000. So, that means I’m regularly picking up interest on my money that is sitting there for day-to-day use and for emergency savings.

Additionally, the Santander 123 account also provides cash back of between 1% and 3% on household bills paid by direct debit, which means I receive a little bit of extra money in my pocket every month just for paying my regular expenses such as gas, electricity and mobile phone. 

Stocks and Shares ISA

Next, I have a Stocks and Shares ISA set up and in this account, I own a portfolio of dividend stocks. These are stocks that give me cash payments on a regular basis. For example, some of the stocks I own include Royal Dutch Shell, Lloyds Bank, Legal & General Group, and Unilever – which all pay their shareholders generous cash dividends. 

The beauty of this strategy is that I receive cash payments throughout the year from my dividend stocks for doing absolutely nothing. The dividend yields on the stocks I own are also far higher than the interest rates available on cash savings accounts right now. For example, Lloyds currently has a yield of around 5.5%, which is over three-and-a-half times the best savings account rate. Moreover, all this dividend income is tax-free because the stocks are held within an ISA, and I can access it whenever I want because this ISA is extremely flexible. 

Lifetime ISA

Finally, I’m also putting money away for retirement in a Lifetime ISA. I won’t be able to touch this money until I’m 60, but I’m fine with that. 

The reason I’m putting money into a Lifetime ISA is that for every pound I put in up to £4,000 per year before age 50, the government will throw in an extra 25p. So, if I put in £4,000 this year which I plan to do, I’ll receive a bonus of £1,000 from the government. That’s no doubt an attractive proposition in the current financial environment. Since I opened my Lifetime ISA early last year, my money has really grown quickly due to the generous top-ups from the government.

So, as you can see, there are plenty of ways in which you can boost your savings right now. The key is to look outside regular savings accounts and be open to different wealth-building ideas.

The post 3 ways in which I’ve grown my savings in 2019 (and you can too) appeared first on The Motley Fool UK.

More reading

• Here’s how Britons can invest in SpaceX on the FTSE 100
• The BT share price is on fire in 2026. Is there still time to buy?
• These 2 Stocks and Shares ISA buys are on fire in 2026
• More oil wobbles as the BP share price dives 7% in a day!
• Meet the 9.6%-yielding income share that could keep growing its payout!

Edward Sheldon owns shares in Royal Dutch Shell, Unilever, Legal & General Group, and Lloyds Banking Group. The Motley Fool UK owns shares of and has recommended Unilever. The Motley Fool UK has recommended Lloyds Banking Group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.