Did you know that most Americans are behind on their monthly savings plan and retirement savings? Also, a report by the Economic Policy Institute shows that Americans aged 56 to 61 years old had a median balance of $ 21,000 on their retirement plan ($ 401,000) as of 2016 (the latest data), and that’s 30 years of savings from them.
Creating a monthly savings plan doesn’t have to be difficult and is a great way to organize your income. As you start planning your future and retirement, read on for some great tips.
Start a monthly savings plan
While a good savings plan can help you get started on your path to a better financial future, it’s best to start saving practically. Take a look at where you are and decide where you want to be in 5 years and below. Commitment is the key to a successful savings plan. Here is some practical advice:
Your financial status today
Take into account your spending and current spending patterns. If you spend your entire paycheck before receiving the next one, chances are you won’t be able to put large amounts into savings at the same time. If reducing expenses is not an option, consider taking on a side job to increase your income.
Track your expenses
A great way to start saving is by tracking your spending. There are monthly savings calculators available to get you started, including this one from Bank of America. Reviewing your bank statements for a few months is another important way to get a better look at your expenses and see where to reduce them.
It is important that you cut your spending and get rid of any debt you may have in order to get rid of deterrents so that you can save as much as possible. Switching banks to cut fees and create check stubs can also add to your expenses.
Start a budget to save
Now that you can see a snapshot of your monthly expenses, it’s an excellent time to organize them into a simple budget. Your budget compares your expenses with what you earn. It will help you stay on track and not over-spend. Experts recommend avoiding monthly costs such as oil changes and other vehicle maintenance.
If you set a goal of saving 10 to 15 percent of your income, you can be financially successful.
A great way to make savings is to use automated deposits. According to a recent report, around 54% of mobile banking users say they use their banks’ app to deposit their checks. Also, 52% believe this is an integral part of the app.
The apps also let you set up automatic transfers for your savings to keep track of things. Over time, your savings will grow directly on your smartphone.
Start your monthly savings plan today
Many say the key to a monthly savings plan is getting it started. Read some of these suggestions to get you started saving. Your future is in your hands.
We hope this article has helped clarify the monthly savings plans and organization. You can find more excellent information here.