We all want to save more money, right? Here are some ideas that can help you increase your emergency savings account as well as save for short-term needs.
1. Establish a Budget
Establishing a budget is by far the best way to save more money. We can check that one off the list because we’ve been using You Need a Budget (YNAB) money management software for the last several years to manage our spending. We review and update our budget every month. By having a budget, we’re in control of our financial goals and priorities living on money left after saving.
2. Open a Savings Account
The next thing I recommend is opening a savings account with a competitive interest rate. You’ll also want to look for an account that doesn’t have monthly maintenance fees and has low or no minimum deposit requirements. We use online savings accounts. Check out Capital One 360 or Ally Bank for good options.
3. Automate Your Savings and Leave it Alone
You may have all the right tools in place (a budget and savings account), but that’s still not enough. Personal finance expert, Liz Weston, has this to say about making savings easier:
The easiest way to save is to do it without thinking about it.
That usually means setting up automatic transfers either from your paycheck or from your checking account. If you have to think about putting aside money, you’ll probably think of other things to do with that cash. If it’s done automatically, you may be surprised at how fast the money piles up.
The second part of this equation is to leave your savings alone. If you’re constantly dipping into savings to cover regular expenses, you won’t get ahead.
People manage to save even on small incomes because they make it a priority. They “pay themselves first,” putting aside money for savings before any other bills are paid. Start with small, regular transfers and increase them as you can.
There you have it, 3 ways to achieve your savings goals. To recap, make sure get the right tools in place with a budget and high yield savings account and then put your savings on autopilot by automating the transfers.
Is saving money one of your goals this year? If so, how do you plan to save more?