Are You Struggling with Savings Balance? Don’t feel bad if saving is becoming increasingly challenging as living costs and expenses increase. Saving what should be saved shouldn’t seem impossible anymore with such high expenses and costs of living being passed onto consumers as expenses mount up each month.
Thankful there are ways you can increase your savings account balance. These include: 1. Opening a high-yield savings account
1. Set up an automatic transfer
Establishing automatic transfers can help ensure you make payments on time, avoid late fees, and save money – particularly if you use a credit card that offers rewards in the form of cash back dollars that can be automatically transferred into an interest-bearing savings account.
Financial institutions such as banks and credit unions often offer ways to automate savings. You can set up direct deposit splits that automatically transfer a portion of your paycheck into savings before it hits checking account.
Set up a regular transfer between your checking and savings accounts at the same bank for maximum flexibility and to compare interest rates more easily. However, be wary of automating too much of your paycheck into savings; doing so could halt your progress in saving.
2. Take advantage of a bank account bonus
Bank account bonuses offer an easy and risk-free way to build interest on your savings. Although they require some work on your part, they’re generally well worth your while.
Many bank account bonuses require you to meet certain requirements, such as making a minimum number of transactions or maintaining a specific balance. Carefully read any terms and conditions as these could contain hidden fees that quickly reduce any bonus money earned.
Keep in mind that bank account bonuses are considered income, and therefore must be taxed as such. While this won’t differ much in the long run from paying taxes on savings account interest earnings, be sure to budget for them when pursuing bonuses as they can add up quickly.
3. Set a goal for your savings
Establishing goals for your savings, whether short term (like saving for a vacation) or long term (such as retirement), can help keep you on the path towards meeting your financial objectives. Setting a realistic plan helps ensure you meet these financial milestones successfully and reach your ultimate financial goals.
Set your savings goals with this in mind – they should be measurable, attainable, and realistic. For example, when saving for a vacation, choose both destination and date as your goals; then determine how much to set aside each month to reach it.
Once your goals have been set, keep them visible as a constant reminder. This can help bridge the creative, thinking part of your brain with its pragmatic counterpart; using an app or spreadsheet for budgeting may also prove helpful in keeping track of progress while serving as motivation during difficult times.
4. Make it a habit
Saving can take hard work, but its rewards can be great. Whether it be saving for a car or home purchase, developing and sticking to a savings plan will help you reach your financial goals faster.
Automate the process by setting up an auto transfer from your checking to savings accounts – this will prevent you from accessing funds prematurely and can help avoid overdraft fees.
Setting up a separate bank account to automate savings is another effective way of automating them, helping you track spending goals more easily while reducing temptation for spending. Plus, the interest earned could add extra savings power! This method also works well if you receive lump sum payments like tax refunds or bonuses that need to be managed efficiently.
5. Make it automatic
One of the easiest and simplest ways to build up your savings account balance is through automating. One approach is setting up direct deposit with your employer so a portion of each paycheck goes straight into your savings account – an effective way of “paying yourself first” while protecting against other expenses compromising your savings goal.
Automated transfers between checking and savings when receiving lump sums such as tax refunds or inheritance can help ensure you make progress toward reaching your savings goals. There are many budgeting apps and online tools that can assist in this effort, though an Excel spreadsheet will suffice – just be sure to monitor accounts closely to avoid incurring overdraft fees or penalties for overdrawn balances or penalties! To increase savings even further consider opening a high yield savings account which pays you interest on all the money stored therein.
6. Take advantage of rewards
Savings accounts provide numerous advantages, including interest and the convenience of withdrawing money at any moment.
Many apps help you save by automatically transferring a small amount from your checking account into savings, tracking spending, and rounding purchases to the nearest dollar. With Smart Swipe’s automated payroll deposit feature, a percentage of each paycheck can even be automatically saved into savings without ever appearing in your checking account!
Take advantage of credit card rewards to increase savings. For example, if you frequently shop at restaurants or grocery stores, find a card that gives cash back. Setting financial goals also encourages discipline while giving a sense of achievement when they’re accomplished.
7. Get a high-yield savings account
Get a high-yield savings account. Either online banking or the internet division of your local brick-and-mortar bank offer accounts with attractive interest rates that are ideal for building emergency funds or short-term goals, like vacationing.
These accounts generally offer higher interest rates than regular savings accounts, and can easily be linked with your checking account to facilitate everyday transactions. Many also allow automatic transfers once every month or two weeks and the higher your interest rate, the faster your balance will grow – some accounts even compound interest daily or monthly; ultimately it all comes down to what your account’s APY, or annual percentage yield, is.
8. Invest in a mutual fund
Investment in mutual funds can be an attractive solution for those looking to diversify their savings across stocks, bonds or cash assets. Mutual funds are managed by professional advisors and pool funds from multiple investors into an investment portfolio comprising stocks, bonds and cash assets.
Investors have the choice between actively managed or passively managed funds, with active funds typically charging higher fees due to fund managers trying to outsmart the market by buying and selling individual investments.
Remember that investing is a long-term endeavor. Your investment portfolio could take years to build up, so be patient as the market experiences its inevitable ups and downs. Furthermore, keep your timeframe in mind when selecting a mutual fund – picking an appropriate fund could help you meet your financial goals more easily.
10. Make it automatic
Setting and forgetting is the key to successful savings, so consider creating an automatic transfer from your checking account into savings. Doing this will ensure you don’t forget about saving, while reviewing your finances regularly will enable you to identify more opportunities to do so.
Apps exist to automatically round up debit card purchases and add the change into savings, and any time you receive a lump sum payment–like a tax refund or bonus paycheck–consider putting it away for savings purposes.
Automated transfers can make saving easier, from short-term goals like paying down debt faster or meeting retirement and debt repayment goals to meeting short-term savings goals more quickly. Just be careful that too much money gets moved automatically into savings at one time – this could overdraft your checking account! For help setting up automatic savings strategies, talk with a bank professional.
