How to Change Your Financial Habits in Honor of America Saves Week
It’s our favorite week at Tayne Law Group… America Saves Week!
America Saves Week is a national campaign dedicated to helping individuals and families save money for the future. This week-long campaign promotes greater awareness for financial well-being and encourages people to adopt better saving habits. This is a great time to reassess your financial situation, trim expenses, and set new financial goals.
The 2016 annual America Saves Week survey assessing national household savings revealed:
- Just two out of every five U.S. households report good or excellent progress in meeting their savings needs
- 52% are saving enough for a retirement with a desirable standard of living
- Only 43% have automatic savings outside of work
- More men (74%) report saving progress than women (67%)
- Those with a savings plan with specific goals (55%) are making more savings progress than those without a plan (23%)
Consider using America Saves Week as an excuse to adopt and apply good saving habits! Here are some things to consider when assessing your financial situation.
Pay Off Debt
To help yourself get out of debt, you need to stop spending more than you earn. Design a budget and allocate money towards necessary expenses while looking to trim unnecessary items in your budget. Figure out what you can afford to pay towards your debts each month based on what your budget allows (hint: try to pay more than the minimum). If you have multiple debts, consider paying off the highest interest rate ones first if possible. If you’re deep in debt and feeling overwhelmed, consider meeting with a financial planner or attorney who specializes in debt resolution.
Save for Emergencies
Try to save between 3 and 6 months’ worth of living costs as a minimum for unexpected expenses, such as car and house repairs and medical expenses. Having an emergency fund helps you remain financially afloat during tough financial times. You can start this fund off small as long as you consistently contribute to it and amass money over time.
Save for Education
With college costs continuously on the rise, it’s a smart idea to look into grants, scholarships, and different student loan options. Look into starting a 529 College Savings Plan for younger children, which is a tax-advantaged savings plan aimed at helping to save for future college costs.
Save for Retirement
Don’t underestimate the power of compounded interest! The sooner you start saving the more you can earn over the course of your working career! If possible, open a 401(K) plan through your employer. Many employers offer to match your contribution to the plan up to a certain amount. Try to gradually increase the amount you put in each year depending on what you can afford. Retirement may feel like a distant dream if you are young, but remember that the sooner you start saving, the more you’ll end up with when it’s time!
Committing to healthier financial habits now puts you on a better path for success later on. Take a pledge for America Saves Week to start saving, pay down debt, and trim expenses. It’s a great time to get started and to embrace good financial habits. In the spirit of America Saves Week, set a goal, make a plan and save for the future!
Share your America Saves Week goals in the comments section below!