How to Start Saving

Saving for Future Goals Can Be Easy

Saving for Future Goals Can Be Easy
 

Savers aren’t born, they’re made. Fortunately, there are easy-to-follow steps and financial tools that can make saving money almost effortless.

Just like getting an education or taking an entry-level job, saving is an investment in your future. “What most of us do is we earn $10, then we spend $10 dollars,” says Mark Butler from YouNeedaBudget.com, a personal budget software business. “What we need to do is make sure that some portion of that $10 we’ve earned is spent on our future.”

For example, your expenses may include rent, student loan payments or something fun, like a vacation with friends. Each time you put money into savings, it’s as though you’ve paid for future expenses. Sometimes these future expenses take years of planning, like buying a home. Other times, these expenses will be unexpected, like making car repairs. In Butler’s words, “I have expenses in the future I have to prepare for and they have a right to a percentage of my budget today.”

1. Start small to make big gains

“People tell me, ‘I can’t afford to save,’” says Gail Cunningham, vice president of membership and public relations for the National Foundation for Credit Counseling in Washington, D.C. “I tell them: You can’t afford not to.”

Simply saving $5 per week can really add up. “Gather your family around the proverbial kitchen table,” she says, “and have a discussion to find that $5.” As you look at ways to find that extra $5 or $50 in your budget, focus on the ways that money can benefit you in the future.

It’s also helpful to remember that the idea of saving may be more effective if you funnel money into an actual savings account, rather than placing all your money into a checking account—where it’s always available to spend. For example, if you see $5,000 in your checking account, it may not feel like a big deal if you spring for a $500 purchase. But if you had $2,500 in checking and $2,500 in savings, it might change the way you see that $500 purchase—since you’d only have $2,000 remaining for other expenses.

2. Make it effortless to save money

Sometimes, remembering to save and prioritizing savings is the main obstacle to creating a nice cash cushion. Avoid this hurdle by setting up an automatic transfer for a certain percentage of your paychecks into a savings account. When you commit your money to a savings account, a bank pays you interest on that money. The more you save, the more a bank pays you in interest, and it compounds over time.

Setting up automatic savings often begins by enrolling in direct deposit for your paycheck. With direct deposit, your employer puts your money straight into your savings or checking account. As an added benefit, on payday you have immediate access to your money, eliminating the risk of lost or stolen checks.

If your employer doesn’t offer direct deposit, you could still set up bank checking and savings accounts and deposit your checks in person, or by using your smartphone to make a remote deposit.

Although tools that automate savings can help, it takes time to transition from a mindset of spending to one of saving. Butler says it’s important to approach your goal with a patient mindset, and to continue tweaking your approach to saving as you learn more. “I have yet to know someone who when establishing a budget couldn’t find ways to spend less money but still maintain their real happiness,” Butler says.

Your savings plan

Let us help you find the best savings account for you.

This content does not constitute legal, tax, accounting, financial or investment advice. You are encouraged to consult with competent legal, tax, accounting, financial or investment professionals based on your specific circumstances. We do not make any warranties as to accuracy or completeness of this information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of this information.

Related

Investment and Insurance Products:

Are Not FDIC or any other Government Agency Insured   Are Not Bank Guaranteed  May Lose Value 

© 2018 SunTrust Banks, Inc

equal housing logoSunTrust Bank is an Equal Housing Lender. Member FDIC

equal housing logoEqual Housing Lender. SunTrust Mortgage, Inc

SunTrust, SunTrust Mortgage, SunTrust PortfolioView, SunTrust Robinson Humphrey, SunTrust Premier Program, AMC Pinnacle, AMC Premier, Access 3, Signature Advantage Brokerage, Custom Choice Loan and SunTrust SummitView are federally registered service marks of SunTrust Banks, Inc. All other trademarks are the property of their respective owners.

Services provided by the following affiliates of SunTrust Banks, Inc.: Banking products and services are provided by SunTrust Bank, Member FDIC. Trust and investment management services are provided by SunTrust Bank, SunTrust Delaware Trust Company and SunTrust Banks Trust Company (Cayman) Limited. Securities, brokerage accounts and insurance (including annuities) are offered by SunTrust Investment Services, Inc., a SEC registered broker-dealer, member FINRA, SIPC, and a licensed insurance agency. Investment advisory services are offered by SunTrust Advisory Services, Inc., a SEC registered adviser. GFO Advisory Services, LLC is a SEC registered investment adviser that provides investment advisory services to a group of private investment funds and other non-investment advisory services to affiliates. Mortgage products and services are provided by SunTrust Mortgage, Inc.

SunTrust Mortgage, Inc. - NMLS #2915, 901 Semmes Avenue, Richmond, VA 23224, 1-800-634-7928. CA: licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, IL: Illinois Residential Mortgage Licensee #MB-989, Department of Financial and Professional Regulation, 100 W. Randolph, Suite 900, Chicago, IL 60601, 1-888-473-4858, MA: Mortgage Lender license #-ML-2915, NJ: Mortgage Banker License - New Jersey Department of Banking and Insurance, NY: Licensed Mortgage Banker—NYS Department of Financial Services, and RI: Rhode Island Licensed Lender.

"SunTrust Advisors" may be officers and/or associated persons of the following affiliates of SunTrust Banks, Inc.: SunTrust Bank, our commercial bank, which provides banking, trust and asset management services; SunTrust Investment Services, Inc., a registered broker-dealer, which is a member of FINRA and SIPC, and a licensed insurance agency, and which provides securities, annuities and life insurance products; SunTrust Advisory Services, Inc., a SEC registered investment adviser which provides Investment Advisory services.

SunTrust Private Wealth Management, International Wealth Management, Business Owner Specialty Group, Sports and Entertainment Group, and Legal and Medical Specialty Groups and GenSpring are marketing names used by SunTrust Bank, SunTrust Banks Trust Company (Cayman) Limited, SunTrust Delaware Trust Company, SunTrust Investment Services, Inc., and SunTrust Advisory Services, Inc.

SunTrust Bank and its affiliates do not accept fiduciary responsibility for all banking and investment account types offered. Please consult with your SunTrust representative to determine whether SunTrust and its affiliates have agreed to accept fiduciary responsibility for your account(s) and if you have completed the documentation necessary to establish a fiduciary relationship with SunTrust Bank or an affiliate. Additional information regarding account types and important disclosures may be found at www.suntrust.com/investmentinfo.

SunTrust Robinson Humphrey is the trade name for the corporate and investment banking services of SunTrust Banks, Inc. and its subsidiaries, including SunTrust Robinson Humphrey, Inc., member FINRA and SIPC.