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Saving

Saving money can be difficult. Many people do not know where to start. There are many ways to save and places to cut cost.

You will find suggestions in the slides that follow for how to start saving.

Saving

One of the first steps to saving money is figuring out how much you spend.

It is important to keep track of every cent you spend, we often over look some of the everyday expenses, that seem small but can add up over time.

Once you have all of the information, break it down into categories and total it all.

Record Your Expenses

Once you know how much you spend, you can begin to create a budget.

Your budget should identify how your expenses and income measure up.

This will make it easy to plan your spending and limit overspending.

There are many tools available to help you create a budget, whether online or just writing it down on paper.

Make A Budget

“Pay yourself” first, before paying your other bills.

After creating a budget, be sure to add savings into it.

If possible, try to save 10-15% of your income into your savings, if you are not able, you should try to cut back on spending to make it possible.

Identify non-essential items you spend money on and start cutting back where you can.

Plan on Saving Money

Think about what you want to save for and figure out how long it might take to save for it.

You may have short term savings goals like a vacation or a new wardrobe or long term savings goals like a house or car.

You can use a savings calculator to help you plan better.

Choose Something To Save For

After your expenses and income are determined, set your priorities.

Which items are most important to you?

Which items can you do with out until you are in a better place financially?

Decide on Your Priorities

Use FDIC insured deposit accounts such as regular savings accounts, high yield savings accounts, bank money market savings accounts, or CD (certificate of deposit) for short term goals.

For long term goals consider accounts like IRAs, stocks or mutual funds.

Remember that stocks and mutual funds are not insured by the FDIC and are subject to investment risks.

It is wise to speak to a financial expert before making any decisions.

Pick The Right Tools

Utilize automatic transfers between checking and savings.

Automated transfers and deposits are a great way to save money since you don’t have to think about it.

Rule of thumb, if you don’t see it you won’t miss it.

Make Saving Automatic

Check your progress.

This will allow you to identify and fix problems quickly.

Carefully watching your savings grow may inspire you to save more and hit your goals faster.

Watch Your Savings Grow

In America, nearly 70% of adults have less that $1000 in their savings accounts.

Around 34% of American adults have no savings at all.

Women are more likely than men to have nothing set aside in savings, income may play a part in this.

Financial advisors recommend having 3-6 months of living expenses in an emergency fund.

One of the top reasons people aren’t saving is because they are living beyond their means- no matter what their income is, some people can’t understand how to spend less than they make.

Source: 2016

GOBankingRates

survey

Saving Statistics

Here are some warning signs that could indicate whether or not you should be saving more:

You don’t know how much you spend:

Most people know how much money is coming in but do not know how much is going out on little things like coffee, meals, etc.

K

eeping track of your purchases may help you identify where you can cut backJot down expenses in a notebook or use an app that can track spending

Signs You Are Not Saving Enough

You don’t have savings goals:

Think about your future and your saving goals

Calculate how much you need for future purchases

Start setting aside a certain amount each week or month

You’re living paycheck to paycheck:If you are barely paying your bills, you are living paycheck to paycheck

You will need to increase your income or decrease your spending

Signs You Are Not Saving Enough

You’re putting off saving for retirement:

People often think retirement is too far away to consider

The longer you put off planning for it, the farther behind you get

Enroll in a 401K and take advantage of any company matching

If a 401K isn’t available, you can contribute to a Roth IRAYou aren’t investing:If you don’t have enough money to invest, you aren’t saving enough

Investing is one of the most effective ways to build wealth

You can invest, even with a little money

Compound interest is an advantage to starting to invest sooner

Signs You Are Not Saving Enough

You can’t pay your credit card balance in full each month:

If you are unable to pay the full balance each month, you are spending more than you should

Analyze your spending habits and identify where you can cut back in order to free up your cash and pay your balance in full

Cut up your credit cards and only pay with cash

You don’t have an emergency fund:

Experts recommend three to six months of living expenses in case of an emergency (car problems, medical expenses, etc.)

Start with even $1000 as a cushion and build on it

Signs You Are Not Saving Enough

It is very important to have money in savings

Financial worries can cause considerable stress for an individual and cause strain on relationships

Use tools that are available to help you start to save or keep you on the right track

Get professional advice when needed

Visit benefits.cat.com to learn more about your Financial HealthConclusion

https://benefits.cat.com/en/wellness/financial.html

https://bettermoneyhabits.bankofamerica.com

www.cnbc.com/2017/04/26/signs-youre-not-saving-enough-money.html

www.bankrate.com/banking/savings/how-to-save-money-8-ways-to-save-money-on-a-budget/#slide=9

Sources