Save Smart

One aspect of saving is save money on the items you buy, looking for deals or shopping where prices are cheaper, but what about saving for your future needs and wants?  Learning to save and putting away money for later needs and wants is one of the single most important aspects of being financially smart.  Below are some ideas:

S= Set a savings goal.

  • How much do you want to save?
  • Be specific about the amount.  10% of your monthly income or a set amount?
  • Idea - Set up an automatic transfer from checking to savings each month.
  • Or,  when you pay your bills each month, write a check to yourself and deposit it into your savings account.
Interest RateMonthly DepositAmount in savings account after:
1 Year2 Years3 Years4 Years
0% $20 $240.00 $480.00 $720.00 $960.00
0% $40 $480.00 $960.00 $1440.00 $1920.00
0% $60 $720.00 $1440.00 $2160.00 $4800.00
0% $100 $1200.00 $2400.00 $3600.00 $4800.00
0% $200 $2400.00 $4800.00 $7200.00 $9600.00
2% $20 $242.21 $489.31 $741.40 $998.58
2% $40 $484.42 $978.63 $1482.80 $1997.16
2% $60 $726.64 $1467.94 $2224.21 $2995.74
2% $100 $1211.06 $2446.57 $3707.01 $4992.90
2% $200 $2442.12 $4893.13 $7414.02 $9985.79
5% $20 $245.58 $503.72 $775.07 $1060.30
5% $40 $491.15 $1007.44 $1550.13 $2120.60
5% $60 $736.73 $1511.16 $2325.20 $3180.89
5% $100 $1227.89 $2518.59 $3875.53 $5301.49
5% $200 $2455.77 $5037.18 $7750.67 $10,602.98

 

M= Measure it.

  • Keep track of your savings and watch it grow.
  • Write down in your savings book or computer each time the money is set aside so you can see your progress.

A= Is your goal attainable?

  • Don't set yourself up for hardship by setting aside so much you are short in other areas.
  • What can you cut out in order to meet your goal?
    • bring a lunch to work vs. eating lunch out
    • rent a DVD instead of going to the show

R= Be reasonable.

  • Don't set an unrealistic goal that you cannot attain - be realistic in what you can achieve.
  • Think of what is reasonable and realistic for your lifestyle and set your goals accordingly.

T= Time.

  • Set a time frame.  How long will it take you to reach this goal?
  • If you are saving for a vacation then your goal might be "I will set aside $50/mo for 1 year so I have $600 saved up to spend on vacation.