America Saves Week: Seven Tips to Help You Save
This week, Faith Technologies is recognizing America Saves Week 2015, a week dedicated to promoting good savings behavior, urging employees to assess their own personal savings status. Did you know that only half of Americans report having good savings habits? Even if you are already saving, it’s still good to take a look at your greater financial picture and decide whether there’s potential to save more or set a new savings goal.
Try these seven saving tips to jump-start your own savings week:
- Set a Goal: How much money would you like to save? And for what? When you pinpoint a clear savings goal, it becomes a whole lot easier to conjure up the self-restraint required to achieve it. It needn’t be a big ticket item either. Simply having a goal to visualize will help keep you focused, motivated, and disciplined.
- Create a Timeline: Once you’ve figured out what you’re saving for and how much money you’ll need, it’s time to figure out how long it will take to reach your goal. If you want to save for a trip to France, for example, figure out how much money you’re willing and reasonably able to part with each paycheck, and then calculate how many paychecks it will take you to get there. This savings plan is the roadmap that will help steer you to the day when you’ve finally saved enough money to book those airline tickets.
- Payoff High-Interest Debt: With planning, discipline, patience, and maybe some outside help, almost anyone can reduce their debts and start to accumulate wealth. Find places to cut your spending, so that you can pay down your debts faster and find places to trim your expenses.
- Set Benchmarks: The act of consciously putting away a set amount of money on a set schedule will help build the muscle memory you need to turn saving money into a habit. Since this is the key to adopting a new behavior that will serve you long after you’ve reached this particular savings goal, it’s important to stay on track. Break down your timeline into weekly, monthly, and quarterly savings targets and be sure to verify that you’re meeting them every time.
- Start Small: If you’re struggling to make ends meet and contributing to your savings account seems impossibly daunting, remember that no amount you invest in your savings is insignificant. Even $1 a day makes a difference.
- Save for Retirement: Saving for retirement now will ensure that you have enough money to maintain a comfortable standard of living when you stop or reduce the amount of hours you work. Participate in a work-related retirement program or open up a Roth IRA. Already saving? Increase the amount you save toward retirement by 1% in 2015.
- Save for Emergencies: An emergency savings fund consists of a small amount of money, usually in a savings account that you do not have easy access to. Saving for this fund starts with small, regularly scheduled contributions that build up over time. Research has shown that low-income families with at least $500 in an emergency fund are better off financially than moderate-income families with less than this amount.
- Reward Yourself: When you reach major savings milestones to help keep up the momentum, reward yourself. For example, after meeting a savings benchmark, treat yourself to a meal at your favorite restaurant, or grant yourself the license to splurge (a little!). Remember, your reward needn’t require you to spend any money, and it certainly shouldn’t bump you off track.
- Family and Youth Savings: Whether you’re budgeting, saving, making retirement decisions, or assessing workplace benefits, share the choices you make with your children no matter what age they are.
- Don’t Let Yourself Slip: It’s important to implement consequences in the event that you fall short on one of your savings benchmarks. If you come up 20% shy of your quarterly benchmark, hold yourself accountable and spend a night in that you otherwise would have spent out with friends. Calculate how much money you saved by forgoing an evening of food and entertainment, and funnel that amount straight into your savings account. Then break out your savings timetable and devise a new plan to help get you back on track.
- Eliminate Your Bad Habits: If you’re still struggling to stick to your plan, see if you can identify any wasteful spending habits, so you can nix them. Keeping track of every outgoing dollar over a two-week period can reveal unhealthy spending habits you never knew you had.
- Save At Tax Time: Do you spend weeks eagerly anticipating your tax refund? When the money finally comes in, is it gone tomorrow? Many people view tax refunds as unplanned bonuses. They see the money as a gift from the government, to use for splurges or treats. But a tax refund provides the opportunity to improve your financial situation.
Follow these tips and you could be on your way to a better financial state in no time.
You can also join thousands of others and take the America Saves Pledge. By taking the pledge you will receive: a welcome e-mail detailing local resources, a monthly e-mail with helpful saving strategies and links to additional resources, a quarterly digital newsletter that features current financial information and stories from successful saves, as well as the option to receive goal-centered text messages all from AmericaSavesWeek.org.