Everyone knows how important it is to put money into savings regularly, but the research shows that 25% of Americans have no emergency savings. Don’t let this be you! If you’re ready to start saving but don’t know where to begin, we can help. Here are 6 simple steps to start saving and get you on the fast track to building your nest egg today:
What’s your secret (or not-so-secret) financial dream? Do you want to open your own business? Explore the Australian Outback. Buy a boat? What are your long-term financial goals? Do you want to make your friends jealous and retire before you hit 50? Do you dream of sending your child to college?
Choose your goals and assign a target dollar value to each one.
When you start saving, first prioritize building an emergency fund with three to six months of living expenses. Thinking of your bigger personal goals now will help keep you focused.
You’re about to turn into one of those budgeting geeks.
For three months, keep a record of your expenses and all income. At the end of the three months, tally up your totals to figure out each average.
If your income exceeds your expenses by a fair amount, give yourself a high-five and skip to the next step.
If you spend more than you earn, or your numbers are too close for comfort, look for ways to trim your expenses and save that extra cash.
Don’t freak out — this isn’t as hard as it sounds. Just use your averages from Step 2 to designate a specific dollar amount for each monthly expense. Don’t forget to include savings in your budget! We have free budget counseling if you need a little help with your budget.
It’s time to choose a place for your savings to call home. For long-term savings, look for an attractive earnings rate option, such as a share certificate at Elevate Credit Union.
Keep that emergency fund and other short-term savings in an account that allows you to withdraw without asking too many questions, like a checking account at your local credit union.
Is this the first time you decided to start saving? Yeah, we didn’t think so. Make it the time you carry out your plans by setting up an automatic monthly transfer from your checking account to your savings account. You can also set up an automatic deposit directly from your paycheck.
Now you know the 6 simple steps to start saving and reaching your goals. Make that trip to Australia happen, that business, or find peace of mind. We would love to be your financial partner if you need a place to put your money. Find out about our saving options.