Set Up a Savings Plan to Grow Your Financial Security

Set Up a Savings Plan to Grow Your Financial Security

set up a savings plan
Saving money can be a daunting task, especially if you already feel your monthly income is strained. Despite the difficulty associated with saving, you know it’s important to save now in order to have the financial security you want and need in the future. Grow your financial security by following these steps on how to set up a savings plan.

Step 1: Set up a budget

More often than not people make the mistake of either not having a budget at all or not factoring in how much they want to put towards savings every month. If you have a budget already then great. If you don’t have a budget, or your budget doesn’t include putting money towards savings each month, then your first step is to create a budget which encompasses all of your monthly expenses such as rent or a mortgage payment, electricity, car payments, etc. Lastly, factor in how much you want to save each month to build up your emergency fund, go on vacation, retire, etc.

Making a budget allows you to see where your money is going. If you know how you’re spending your money you know what areas you can cut in order to put more towards savings.

Step 2: Pay yourself first

If you’re the type of saver who only contributes what is left over after paying the bills and buying groceries to your savings, then it would be best if you change your mentality. Just as you pay an electric bill every month, you should make a note to pay yourself just as you would pay a bill. This not only makes savings habitual, but it also means you don’t have an excuse for not saving anymore.

Step 3: Automate your savings

After you’ve determined how much you’re going to save, you can automate the process so you don’t have to rely on pure will power to pay yourself each month. See if your employer will direct deposit your paycheck into two accounts for you. You can have them distribute how much you want to save into your savings account and the other portion into your checking account for you to use for bills. After all, you won’t miss the money you never see.

Step 4: Eliminate easy access

If you’re prone to transferring money out of your savings then perhaps you want to open a savings account through an online bank. You’ll still have easy access to your money with this type of account but there are two main advantages. First and foremost you’ll have to wait a day or two longer to get money transferred from this account to your checking account meaning you may not want to go through the hassle. Secondly, you may be able to obtain a higher interest rate than what is offered locally, which means more mula in your savings.

A very green future

Saving money can be difficult, and it can be even harder if you’re having to cut out expenses such as your daily coffee run, or your weekly dinner with friends. If you set your mind to it, and keep track of your budget, you can do more than you think; you can grow a very green financial future.

How did you set up a savings plan?


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