RSS FeedWhen you have bills to pay, it’s hard to think about saving and setting aside a little each month for the future.
But just think of the last time you had a financial emergency: An unexpected car repair, a medical expense, or a large insurance deductible, or expenses that were not covered.
Think about things you would like to—or need to—get: A new car, a home repair, a computer, or even just a special movie and dinner night out.
And finally, think about larger expenses you want to be prepared for in the future: College or training, a medical procedure, a vacation, or even retirement.
Sound overwhelming? Not if you take it one simple step at a time.
Set Your Budget
We’ve talked about establishing your income and expense budget here, and on the PayDayHawaii website we even provide you with a budget template that you can download here (in the green box). All you have to do is fill it in! Once you do that, you can see where you have opportunities to save.
Finding Money to Save
We give you a good start with suggestions on easy ways to save here, from bringing your lunch to work instead of eating out, to negotiating better rates on some of your bills (cable, for example). And there’s more! Save all or part of your tax refund. Think about other ways you can set aside $5, $10, or $20 at a time. Start with stashing all the coin change you bring home in your pocket or purse. Small amounts really add up!
America Saves offers even more great ways to get started saving here and here.
The Interest Advantage
How to get free money? By putting at least some of your savings where it will earn interest. And especially compound interest—where you earn interest (money added to your savings account) on top of both your original savings amount plus the interest that you’ve previously earned. Interest on your interest!
An easy way to start: With a PayDayHawaii NetSpend prepaid debit card. NetSpend offers a 5.00% interest (Annual Percentage Yield)—one of the highest interest rates in the country. There’s more information here, or stop in at one of our convenient locations.
The Ways to Save
Many people think that having a traditional savings account at a bank is the only way to save. Not true! Today there are quite a few ways you can set your savings aside. See which you feel more comfortable with, which will encourage you to keep saving, and what the fees and withdrawal requirements (and any penalties) are for each.
- Reloadable prepaid debit card: Set aside cash that you save, and then load it on to your prepaid debit card weekly, monthly, or whenever. Make sure you stash that debit card where it won’t get lost, and where you won’t be tempted to use it! Start a card for each of your savings goals.
- NetSpend prepaid debit card: As mentioned above, this prepaid debit card offers interest, and it’s FDIC insured.
- Savings Bonds: Purchase in amounts as low as $25, guaranteed by the Federal government, earns a fixed interest rate.
- CD or Certificate of Deposit: Purchased through traditional banks and credit unions, often available in amounts starting at $500.
- Credit Union savings and bank account
- Traditional bank account
- Cash—no fees involved!
Now Set Your Goals
You can save more by having a goal in mind. Visualizing what you want to save for gives your savings a purpose; otherwise you may be tempted to withdraw from what you’ve saved. But once you have a goal in place, you know that taking money out of your savings is taking away from that ultimate goal.
Your savings goals can be small or large, and you can even have more than one. Maybe you want to put money into an emergency savings fund AND want to start saving for a car or house purchase. That’s fine—just set up both, and make sure you contribute regularly to both.
Keep track of what you are spending (here’s where your budget comes in) and what you are saving. Nothing motivates you more than seeing those savings add up!
For more information on saving, stop by your local PayDayHawaii location. You can also now follow us on Twitter, @PayDayHawaii.
