Put Away $1000 Without Stress This Year
Your financial health depends on having a savings account, to protect you and your family from financial emergencies.
Having money in a savings account becomes invaluable, in the event your family suffers a significant pay cut or layoff.
The same holds true for unexpected needs like home or vehicle repairs, or medical bills.
What You Can Do
Don’t wait, start a savings fund today. It doesn’t have to be a big expense each month, especially in the beginning. Let your emergency fund grow over time.
If you’re living paycheck to paycheck, it may seem overwhelming to add a savings investment to your responsibilities, but it is possible. If you take small steps, you can even put $1000 away this year without stressing out in the process.
Here are some tips on contributing to an emergency savings fund:
1. Pay yourself first
Building cash reserves means paying yourself first. Set a specific amount every pay period that you can save and pay your savings before you pay anything else. This develops the good habit of putting at least some money away, even if the amount is small.
- Inquire with your bank to see if they have an automatic transfer option. Set up an affordable amount to transfer out of your checking account and into savings automatically each pay period. As they say, out of sight is out of mind. You won’t miss the extra cash you’d waste on something less rewarding six months down the road.
- Something as little as $5 each week adds up to $260 in a year’s time when you start today.
2. Keep these funds out of reach
Make it harder to spend the money you want to save for a rainy day, by keeping these funds out of easy reach. If you have to transfer money to spend it, you won’t be as tempted to do so frivolously. Of course, some money should remain accessible, but savings shouldn’t be part of those funds.
- For example, you could use a bank that isn’t in your immediate area, making it more difficult to take money out of the account. This keeps you honest with your money so you don’t spend it poorly.
3. Save pocket change
Lots of people fill a jar or large container with pocket change, and they’re often amazed when it comes time to count up what they want to deposit. These amounts won’t pay for your retirement, but they do add up over time.
Pocket change is something you won’t miss, until you realize how much you’ve saved. Fill your containers, then roll the coins and deposit them into the bank.
4. Take it one day at a time
Saving $1000 may seem like a slow process, but if you take it one day at a time, you can achieve your goal. Setting small goals initially is the key to long-term success.
As your savings grow, you’ll work harder to achieve the things you want for yourself, one at a time. What ways can you guarantee a few extra dollars for a savings account every week? What can you cut back on to save money?
- Even if you put just $3 into a savings account each day with an interest rate of 1%, you’d save almost $1100 in one year; $5 a day would save more than $1800. What can you do today to save $3? One less snack, one less cup of coffee, one less trip in the car. Make small adjustments like this and watch your savings grow over time.
- It’s the small sacrifices each day that help you reach your long-term savings goals. Take each day as it comes, keep a few of your favorite things for indulgences, and make good choices on your available cash to save as much extra money as you can.
Take that extra pocket money and turn it into an investment that rewards you later on. Small steps add up significantly over time.
These steps also make saving money a regular part of your daily routine. You’ll be surprised how quickly you can build up an emergency fund using one or more of these strategies.