Money Insider: It's never too late to save for a rainy day

Whether it's a rainy day fund, some cash to help towards the cost of Christmas or the annual summer holiday, many of us strive to put a little money aside.

Despite the current low interest rate environment, saving money on a regular basis will always be a habit worth adopting.

Even a balance of a few hundred pounds will help if you are suddenly faced with an unexpected bill and will save you having to rely on expensive plastic.

However, for most people the hardest part of saving is actually getting started.

We may have good intentions of saving some of our salary at the end of the month, but by the time we get there it's often been spent elsewhere.

A sensible solution is to set up a standing order so that your money is switched to your savings account the day after you get paid, that way it won't be sitting around in your current account tempting you to spend it.

Many banks and building societies offer regular savings accounts and although the interest rates are often two or three times higher than standard savings products, the terms and conditions are pretty strict.

Although some may find the restrictive terms and conditions a little off-putting, for others it helps to instil the financial discipline they need to stick to a regular savings routine.

If you've got a current account with First Direct you can get a regular saver account paying 6 per cent AER, while HSBC offers the same rate for its premier and advance customers and 4 per cent to bank account holders.

Other deals worth a mention, and where you don't need to hold a current account with the provider to qualify, include Kent Reliance paying 4 per cent AER, West Bromwich Building Society at 3.30 per cent AER and Leeds Building Society paying 3.05 per cent AER.

Once you get into the habit and have built a savings pot, it gives you many more savings options – maybe putting your accrued lump sum into a fixed-rate bond or an ISA while you take out a new regular saver for the following year.

Don't fall foul of insurance exclusions

Just because you've purchased insurance cover, don't assume that you'll automatically be covered if something goes awry.

For example, with your car insurance, be careful not to underestimate your annual mileage calculation because if you claim to be driving 10,000 miles each year, yet are driving twice that distance, don't be surprised if the insurer throws out a claim.

Similarly when applying for home cover – in many instances you must state whether the locks on your doors comply with British safety standard BS3621. Not surprisingly, as in some cases you'd need to remove the lock to check, the question is often answered incorrectly. However, it could prove an expensive mistake because if you suffer a break-in and it is found that the lock does not match the details on your policy, your insurer may refuse a payout.

Another important tip is to ensure you always report a theft to the police within 24 hours of the incident. Insurers will ask you for a crime number as part of the claim process. Failure to obtain this could cast doubt on whether a theft has taken place and could result in a rejection.

The annual premium is the key factor for most people when they receive their insurance renewal, but a read through of the individual cover and exclusions is equally important if you want to avoid any nasty surprises.

Andrew Hagger is an independent personal finance analyst from www.moneycomms.co.uk