Whether you’re saving for a specific purpose, looking to build up an emergency fund, or thinking about working towards any other savings goals, Liberty Bay is here to help. Ready to save money in 2021? Read through our guide to healthy financial savings.
Use a savings account that works for your savings goals
When putting money aside for safekeeping, it’s a good idea to have at least one separate account dedicated to your savings funds. This method, called “earmarking,” has been shown to increase savings rates! Make sure to look for an account with few or no fees so that all your money actually goes to your savings and not to the financial institution.
There are many savings account options that may work for your goals, including high-yield bank accounts, certificates of deposit, retirement accounts, bonds, and more. Use our short FA$Ttrack course on Savings Accounts to help you choose which one will work best for you.
Review your spending behaviors and plan to save money
You should aim to set time aside at least once a year to review your credit report and spending habits, as well as generally to check in with your financial health. This will help you catch errors in your credit report or identify patterns in your spending behaviors, all of which make it easier for you to create a budget and achieve your goals.
One thing you should always include in your budget is a savings amount. Think of it as a monthly expense, like your utility bills – except, in this case, you’re “paying” yourself! Instead of saving money left over after you pay your bills and make purchases, commit to saving a certain amount each month. This way, saving money will become a regular, automatic, healthy financial habit.
Reduce debt to increase savings
One survey shows that approximately 80% of Americans are currently in some form of debt. While taking on debt may be necessary to help you achieve financial goals like getting an education or buying a house, managing debt properly will help you increase your savings and financial health.
Reducing debt takes smart planning, but helps you increase your savings. Wouldn’t you rather save money instead of paying interest? Wouldn’t you like to see your net worth increase or your investments rise in value as you pay off mortgages and become the full owner of your assets? That’s what we want for you too! Learn more through our FA$Ttrack course on Debt Management.
Build savings in case of emergencies
Do you have an emergency fund? Even if you’re able to cover your expenses every month, it’s necessary to be prepared in case of unexpected financial emergencies so you can preserve your financial health. Build emergency savings in order to be truly financially healthy!
Of course, no one wants to think about emergencies – but that’s exactly what emergency savings are for. If an emergency does happen, you’ll be able to handle the unexpected with much less stress if you have an account dedicated to being your emergency cushion. Learn about emergency savings goals, options, and tips in our FA$Ttrack guide to Building Emergency Savings.
Save money as a family
Finances can be a tricky or uncomfortable topic for many people, but it doesn’t have to be! Being able to have family conversations about money or work on budgeting and saving together can be a great way to bond, build trust, and improve teamwork as a family. Whether you’re talking with a partner, your kids, or between generations, be proactive about these conversations to get on the same page about saving money.
Want more resources on saving money as a family? Check out our FA$Ttrack guides to Budgeting for Families or important questions to ask during Family Conversations About Money. You can even teach your kids good financial habits with savings accounts for kids!
No matter what your financial goals are for 2021, your Liberty Bay experts want to help you save money and improve your financial health. Get in touch with us at any time for help, answers, guidance, and more.