Tips on meeting your savings goals

Setting clear goals can motivate you to take action, focus on what’s important, and steer clear of overspending.

|
Wilfredo Lee/AP/File
A wallet containing cash and a Visa card in Surfside, Florida (Feb. 2, 2011).

Saving money is often easier said than done, but it doesn’t have to be difficult. Setting clear goals can motivate you to take action, focus on what’s important and steer clear of overspending.

Here are a few tips on how to set your savings goals.

Map out your goals

Ask yourself, “What do I want to save for?” Your goals may be short-term, like buying a new TV or taking a trip to Europe; long-term, like purchasing a new home or saving for retirement; or somewhere in the middle, like paying off your student loans.

When setting goals, factor in needs — like an emergency fund — in addition to the things you want to save for. Anna Sergunina, a certified financial planner at MainStreet Financial Planning, recommends prioritizing your emergency fund before other goals; otherwise, you can suffer a major setback if something unexpected comes up. “If there are no funds, that’s going to put a break into the whole system,” she says.

After you identify and prioritize your savings goals, you can start to make a customized plan.

Assess your finances

Take a good look at your finances to see if your goals are within reach. Calculate your monthly income based on your paycheck, Social Security benefits or any other money you receive. Then, check your transaction history on your bank’s website, or use an app, spreadsheet or simply a piece of paper to track your expenses. That way, you’ll know where your money is going, how much you have left and what amount is reasonable to set aside each month.

If you want to reduce your spending in order to put even more money toward savings, identify your needs and wants and try to indulge in the wants less. Needs are things you must spend money on — like food and housing — and wants are the nonessentials like entertainment and restaurant meals. If you’re not sure how to budget for these expenses, give the 50/30/20 budget calculator a try.

Do your research

Find out not only how much you can save, but how much you need to save. For example, if your goal is to vacation in Italy, research the cost of plane tickets, a hotel stay and sightseeing. This will give you an estimate of the price tag and, therefore, your savings total. Expand your search to find the best discounts and savings methods.

Pick a time and place

Choose a deadline. You can stockpile your funds as that date approaches.

Once you begin to cut back on or restructure your expenses, decide where to store the money you save until you need it. Consider putting it in a savings account or certificate of deposit, preferably one that offers a competitive interest rate, to keep it safe and help reach your goals faster. It might even be worth creating separate accounts for your individual goals.

An easy way to contribute to your savings goals with little effort is to automate the process. Apps like Digit let you specify your goals and will automatically transfer a certain amount of your funds into a special account.

Follow up

Reminding yourself to track your progress is an effective way to stay on top of your savings goals. Sergunina suggests setting up a “money date” with yourself or your significant other, say once a month, to periodically look over your financial activity. Review your income, expenses and how much you’ve saved so far.

If you’re not quite where you want to be, don’t get discouraged. “We all make mistakes,” Sergunina says. “Life happens. So as long as you check in, pick yourself back up and keep going, that’s what counts.”

Lauren Schwahn is a staff writer at NerdWallet, a personal finance website. Email: lschwahn@nerdwallet.com. Twitter: @lauren_schwahn.

This story originally appeared on NerdWallet.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Tips on meeting your savings goals
Read this article in
https://www.csmonitor.com/Business/Saving-Money/2017/0309/Tips-on-meeting-your-savings-goals
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe