Five Tips to Jump-Start Savings

To set yourself up for savings success, build a simple budget. Think of it as a road map that tells you exactly where you are in terms of monthly income and expenses, what money is available to save each month, and if you’re on track.

A budget helps you monitor and track your financial progress. The most important part of your budget is updating and monitoring it regularly.

Build it in a format that works best for you – using a smartphone app, spreadsheet or simple notebook. Keep it in an easy to find spot to track your income, spending, and saving as you go forward.

Use our Spending Plans: Beyond Budgeting breakdown to help you get started!

The SMART acronym provides a strategy for reaching savings goals that are Specific, Measurable, Achievable, Realistic, and anchored within a Time Frame.

As an example, depending on your specific situation, perhaps you can tuck away $20 each week to hit an annual savings goal of $1,000. Measure your progress each week and modify as needed. By keeping it SMART, you will more likely achieve savings goals when bite-sized amounts are saved over a realistic timeframe.

It can be hard to save money when struggling with high credit card debt. The longer you carry large balances, more of your monthly payment is applied to interest and the less you have to tuck away in a savings account. You can save the most money by starting to pay as much extra as you can on your highest-interest debt first. Once that’s paid off, move on to your second-highest interest debt, and so on. It’s called the snowball effect. Here are some credit basics and best practices to help you along your debt-free journey.

A savings plan should include building an emergency savings fund to handle unexpected expenses and setbacks that can come up suddenly. A general rule of thumb is to set aside three months’ worth of living expenses in your emergency fund. This buys you some time if something were to happen. If that isn’t realistic for your situation, start with what you can. It’s most important to get into the habit of prioritizing your savings and to begin making progress. You don’t have to bite off the whole goal all at once. Learn about great Share Term Certificate and Money Market Share Account rates to help you build that fund faster.

The most successful savers automate monthly deposits to make it as painless as possible. Decide how much you can put into savings and set yourself up with an automated transfer. Another good option is to automatically direct deposit a portion of your paycheck into savings every payday. Begin with an amount you can afford to put into savings and look at your big-picture plan to set your savings goals in the long term.