Six Ways to Build Better Savings in 2023
Tucking money away in a savings account is a healthy habit that many people strive for each year. However, the best-laid plans don’t always come to fruition. A recent financial survey found that more than one in five working American adults fail to set aside any of their annual income for savings.
Mark Halstead, Branch Manager at Village Bank’s Sliding Hill branch, says saving money doesn’t have to be an overwhelming process. We work closely with our customers to help set them up for success with healthy savings habits,” according to Mark. If you’re struggling to build your savings, Mark has six tips to help you get started this year!
- Shift your mindset.
Saving money is like dieting. If you’re going to be successful, you must commit to it! It’s a matter of creating a healthy habit that you’ll stick to over time. Start by shifting your perspective on what a savings account is. According to Mark, people often have the misconception that their savings account is similar to a retirement fund or an investment account that can never be touched. “The reality is a savings account is built for whenever you need backup funds (a car accident, house repairs, job loss, etc.).” While it shouldn’t be used for everyday expenses, it is accessible money that’s there whenever you need it.It’s also a much safer way to store your money. Debit cards are linked directly to your checking account and should your card or pin number fall into the wrong hands, your cash could be gone in an instant. A much safer option is to keep a minimum balance in your checking and store your money in a savings account that can be pulled from as needed.
- Be realistic.
You wouldn’t go on a diet and not eat anything for three days. That’s not a sustainable or healthy. The same is true when building your savings. Mark says it’s important to be realistic about what is possible and sustainable for your specific situation. Whenever you get paid, put a realistic portion of your paycheck into your savings account, whether that’s $20 or $1,000. Remember, what’s realistic for you may be different from someone else. It may be tempting to start off with a bang, but don’t go beyond your limit.
- Be prudent with disposable income.
This is the not-so-fun part of saving money, but making prudent decisions with your disposable income is one of the best ways to tuck a little extra into your savings account. Do you really need that new pair of shoes or could you better use that money by saving it for the future? Before you make any significant purchases, think it over for a few days. This will help you avoid impulse buys that are a big opponent to saving money.
- Be creative.
If funds are tight, it can be difficult to find ways to set money aside, but there are lots of ways to generate a little extra money for your savings account. Check your wallet and pockets for leftover cash at the end of each week and deposit it into your savings. Additionally, consider canceling any unused subscriptions and redirect those monthly fees into your savings instead. Remember, a little can add up quickly!
- Keep it simple with automation.
One of the best ways to stick with a habit is by making it easy on yourself. Automating your savings by turning on direct deposit is one of the most effective ways to build up your savings. Pick a reasonable dollar amount to come out of your pay check biweekly or monthly with direct deposit. This money will continue to go directly into your savings without any extra effort on your part.
At Village Bank, we pride ourselves on helping our customers build healthy habits around money. We can help you determine the best way to save money on a regular basis and monitor your savings account to avoid unnecessary fees. By creating healthy habits around your savings, you can quickly set up a safe, accessible fund that’s available whenever you need it!