Saving money is simply a matter of forming the habit of putting away a fixed amount each week or each month before you have a chance to spend it. Make it part of your budget, and practice a "pay yourself first" approach by making regular deposits into your savings or retirement account.
Some additional tips to help you start saving money today include:
- Pay off your debts. The interest you're paying on your credit cards is likely much greater than the interest you can earn in a bank account, so getting rid of such debt is even more important than putting money in the bank. And if you're paying off multiple debts, consider ways of consolidating them at a lower rate if you can.
- Set firm savings goals, and stick to them. Make a deposit in your savings account the first thing you do each payday. Savings should be your first priority, not your last. Try depositing 10 percent of every dollar you earn in a savings account. Do that over time, and you may well be on your way to long-term financial security. To make it even easier, you can set up an automatic transfer from your checking account to your savings account.
- Establish real time goals. If you want to buy a house three years from now, for example, figure out the down payment you'll need and start making regular savings deposits to cover it.
- Try to save the same amount each period. You probably need to save for more than just one thing: retirement, buying a home, kids' education. Determine what you need to save for each, add them up, and make the appropriate savings deposit every month. If your money won't stretch that far, your goals may be unrealistic and you should consider putting something off a bit.
- Cut your expenses. Saving money may be easier when you discipline yourself to spend less. Try keeping an accurate budget for a month or two. You'll be amazed at what you spend on incidentals—some of it completely avoidable when you really examine your needs versus your wants. Parking tickets? Restaurant meals? Credit-card interest payments? High utility bills? Examine your monthly expenses and look for ways to start pinching pennies.
- Pay off your credit cards each month. When shopping online, paying for an airline ticket or making a reimbursable purchase for work, credit cards are most convenient. So to keep your expenses under control, pay off your credit cards each month. This way, you save on the hefty interest charges and/or fees and still get the convenience of paying with plastic.
- Open an interest-bearing checking account. Carrying cash can make it easier to spend, but putting it in an interest checking account keeps your money safe while putting it to work for you. And when used in conjunction with a savings account, you have the opportunity to make the most of your money on two fronts.
- Participate in your employer's 401(k) savings plan. If you're eligible—and if it makes sense for your budget—try to make a point to contribute enough to get the maximum employer match.
Ally Bank is committed to making saving as easy, secure and rewarding as it can be. From our Interest Checking Account and Online Savings Account to a full line of CDs and more, Ally Bank is here to help. You can open and fund any account with any amount and earn among the most competitive rates in the country. Plus, your deposits are insured by the Federal Deposit Insurance Corporation (FDIC) up to the maximum amount allowed by law. Learn more at Allybank.com or call live, 24/7 customer support at 877-247-ALLY (2559) today.