Starting to Save
Figuring out your financial goals is a great first step to saving money. Determine what you need to save for, both short-term and long-term, and then estimate how much you’ll need to save. Short-term goals may include travel or a down payment for a car. Long-term goals may include a down payment on a house, tuition or retirement. Before putting any money into your savings goals, work on building up an emergency fund that would cover a few months of living expenses.
Keeping track of your expenses and creating a monthly budget will help you determine what amount you are able to save each month. With the 50/30/20 rule, 20% of your after-tax monthly income should go towards savings or debt-repayment. Allocating money for your savings goals in your budget will help you reach your goals faster.
Consider your options for saving based on your short-term and long-term goals. There are a variety of options to maximize your saving potential including retirement or investment accounts, Coverdale Education Savings Accounts (CESA), or certificates of deposit. Whatever route you choose, make sure to automate your contributions so that you don’t fall behind on your goals.