Maybe you’ve read the news stories about how few Canadians currently have savings, or you’ve decided to accumulate savings as part of an overdue New Year’s resolution. Whatever the reason, having savings has major benefits — and here are some easy steps you can take to get yourself started:
Decide what the savings are for: They could be for an emergency fund, in which case you can plan to leave the funds alone. (And hopefully you won’t need them!) If you’re saving for a holiday then you’ll know how long you’ll need to achieve your goal. If the money is for long-term plans like retirement or post-secondary studies then the time frame for accessing your savings will be important.
Shop around: There are a variety of savings accounts and plans available to you so ensure you’re setting up an account that works for your particular savings plan. Canadian Tax-Free Savings Accounts have been around for a few years now but recent reports show that the majority of Canadians aren’t yet taking advantage of their perks or don’t know how they work. There are also no-fee bank accounts available that will pay you interest while your cash is sitting. Do your homework thoroughly and pick something that best suits your needs.
Work saving into your budget: Simple right? But so important! If you don’t budget to have a portion of your paycheque go towards savings chances are it won’t happen. To further resist the tendency to spend your savings, set up an automatic withdrawal so funds are moved to a savings account for you.
Set savings goals: Break down how much you’ll need to save and the time you’ll need to get there, keeping it realistic and attainable so you don’t set yourself up for discouragement. Even if you start small, watching the dollars grow will be a great motivator to keep with it!
Check your progress: Periodically review your goals and accounts to see how you’re doing. You may find after a few months you’ll want to ramp up your savings and readjust your budget. Or if you find you’re struggling, don’t get discouraged. Try to pinpoint where the hurdles are so you can shift your focus.
Now that you’ve set yourself up on the savings track all you’ve got to do is…well, save! Keep an eye out for the second part of this post, “Small and Easy Ways to Save,” if you’re looking for ideas on how to find a little extra to put away.
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