What are you saving for? A wedding, a new baby, college, a down payment on a house? How will you pay for an emergency when “Murphy” shows up at the door? Have you been thinking about saving but just haven’t taken the plunge?
Many of us know the feeling. We want to buy a big-ticket item, take a trip, or handle a financial emergency, but we don’t have the cash.
A dedicated savings plan can help, and there’s no better time to start one than this week. Military Saves Week offers service members and their families a chance to assess their preparedness for the future. We’ve heard the mantra: “Financial readiness is critical to mission readiness” — but it all starts with a plan.
Start early. Do it today. Procrastination is not your friend. Start here to apply for an account.
Start small. Even the pyramids of Egypt were built one brick at a time. With little tweaks in the way you use your money, you can be well on your way to meeting or even exceeding your savings goals.
Stay committed. Pay yourself first out of every paycheck. Consider saving automatically; that way, you don’t have to remember each pay period, and you’re not tempted to skip deposits. USAA’s Savings Booster can help you set up automatic savings.
Strive to save 10-15% of your gross pay. If that figure feels unrealistic, start with whatever amount you can, and increase your contribution with every promotion and bonus. To keep you from depending on a high-interest-rate credit card, stock an emergency fund with at least $1,000 for unexpected expenses. Ultimately, strive to keep 3 to 6 months’ worth of basic living expenses in your emergency fund.
Saving for a specific short-term goal is an excellent way to work toward saving for the major expenses in life, like buying a house, putting kids through college and eventually being able to retire in comfort.
As you watch your balance grow, you’ll forget those times you passed up short-term gratification to fund your savings. Instead, you’ll focus on how much wealth you built and how much closer you are to your goals.