America Saves Week: How to Save Automatically
If you’ve followed our blog for a while, I’m sure you’ve seen blog posts on savings over and over and over. Generally, I try not to be redundant, repeat myself or say the same thing over and over. 😉 But the important topics do need to be talked about a lot because: a) they’re important for a reason, and b) sometimes we all need gentle reminders of something we should start, restart or continue.
America Saves Week, from February 24 to 29, gives us multiple reminders. Its theme for today is "Saving Automatically."
Some folks hear “save automatically” and think “No, thank you; I need to pay my bills first.” Bills are certainly a top priority; however, you should treat savings as if they are important bills to pay — just like rent, utilities or insurance.
Create a Realistic Budget
There are many ways you can create a budget. Some people use a simple spreadsheet, others use apps, and some keep track of spending using their online banking tools. The method you choose doesn’t matter. What’s important is having some sort of budget and that you’re tracking spending, where your money is going, and how much (if any) you have left over once you pay bills and other monthly/periodic expenses. Find what works for you, and determine what you can afford to save each month. Then divide that by the number of pay periods you have each month.
Start Saving Automatically
The easiest way to start is to set up automatic deposits into savings from your paycheck before the entire amount even hits your bank account. Set up two deposits: one for savings and one for everything else. Having a separate savings account is the best way to avoid touching that money; that way it will build up more quickly. Another option is to set up an automatic transfer each pay day. Have that money transferred from your main account to your savings account. Again, just try to think of that money as untouchable unless it’s necessary. And “necessary” means an emergency or unexpected expense that meets a real need — not last-minute concert tickets. 😊
Check Out Apps That Save Automatically When You Spend
If it fits into your budget, another great way to save automatically is rounding up purchases and saving the change. While the total might not be as substantial as a larger lump sum deposited from each paycheck, every little bit helps. And when you’re rounding up by cents, you will not even notice that it’s gone from your main account. So, check into legit, safe apps that can help you do this. If you don’t want to use an app, add up the number of purchases you made at the end of each week, and transfer $0.50 or $1 into savings for every purchase that week.
Why Save Automatically?
We’ve talked about the how; now here’s the why. Because LIFE HAPPENS. It happens all the time without warning. People and pets get sick or injured, cars break down, etc. Building a safety net of savings is the best way to prepare for an emergency and avoid the potential debt that may result — not to mention the added stress. Going into debt only makes an already difficult situation harder and more stressful.
So, if you haven’t started saving automatically, now is the time. America Saves Week is a great time to refresh your savings goals and take action to build up savings. Don’t let that next emergency take you by financial surprise.
If you are having trouble finding money in your budget to save, contact LSS Financial Counseling for help. Our experienced counselors will work with you to create a realistic budget and savings plan based on your individual situation. Call us at 888.577.2227 for your free, confidential session or complete it online at your convenience.
Author Elaina Johannessen is a Program Director with LSS Financial Counseling.