So, I might have mentioned before that my day job is in banking. This by no means makes me any type of financial expert. Sometimes my bills get paid late, and I make impulse purchases a little more often than I’d like to admit. But, I’ve been working on ideas to beef up our savings account without having to change or cut any of our current expenses much. I’ve searched Pinterest and one popular method is a weekly savings plan where each week of the year, you gradually increase the amount of your deposit into your savings. While intrigued by this idea, I wanted to figure out something even simpler. I wanted to be able to “set it and forget it”—that is, to decide upon a small weekly amount, and set up an automatic transfer into my savings.
Most of the weekly savings plans/challenges I read up on netted you anywhere from $1,000.00 to $1,500.00 in your savings over the course of one year. I figure since I am lucky enough to go home for lunch and not eat out during the week, I can spare $20.00 per week fairly easily. Multiply $20 by 52 weeks, and by the time I ring in 2017, there will be $1,040.00 more in my savings account! How awesome is that?
Most of us that want to save money have a hard time seeing a small amount go into savings making much of a difference, but it’s impossible to deposit any large sum into your savings either, so you can kind of feel like you’re stuck. Can’t do $20 a week? Depositing any amount is better than nothing at all. $10 a week will get you $520 in one year. $5 a week will get you $260. And even $2 a week will get you $104 by the end of the year. I don’t know about you, but any of those amounts certainly could come in handy for me. It’s like built in bonus for yourself! It’s simple math, but it is amazing to see on paper the huge difference it can make in your savings account! Do you want to meet a specific dollar amount in your savings within a year? Divide the amount you’d like to meet by 52 and see if you can meet that weekly deposit amount. Want to try to save $2,000 in a year? Do you think you can deposit $40 each week? Again, it’s super simple math, but sometimes it helps to have a visual!
I’ve been told when starting any sort of workout regimen, “The only workout you regret is the one you didn’t do.” Usually, getting started is always the hardest part of my workout. But, once I gave myself five or ten minutes to get in my groove, I’ve gained enough momentum and motivation by that point to keep going and finish. I believe the same is true of building your savings. You just have to start somewhere. Make a point to make a deposit no matter how small each week, and that momentum will carry you. You will start to see those small amounts add up week after week, and you kind of get addicted to watching that account balance grow!
Want to make your money work even harder for you? A great option offered by many banks is a Christmas Club account. It’s a savings account designed to squirrel money away for holiday expenses. These accounts typically have a better interest rate than other savings accounts, however you would not be able to withdraw from this type of account without paying a penalty (usually whatever interest you have accrued, so don’t put money in there if you’re going to need to take any of it back out!). You save your money throughout the year (I highly recommend an automatic transfer–set it and forget it!), then just before the holiday season kicks into full swing, your bank will cut you a check for the balance of your account. You will usually have a window of time (30 days or less) to make a deposit back into the account to keep it open, or if you choose not to do this, the account will automatically close itself out. Then, all the money, including the interest it has earned, is all yours to do whatever you want!
If those options do not work for you, stop by your community bank and talk to a personal banker. They can advise you on the different types of accounts they offer at your institution and the various benefits of each. I have found that many people are intimidated by banking simply because they don’t know enough about it, but I’m telling you, anyone can learn the basics to meet their needs. If you don’t understand what something is, ask! Your bank should work for you and help you toward achieving financial success. And well, if they don’t….come switch to my bank! 😉
What tips and tricks are you using to grow your savings this year? Got a question for me? Leave me a little something in the comments!