Saving

Savings Tips

1. Consider your needs vs. your wants. Think about items you purchase on a regular basis. These add up. Where can you save?

• Do you eat out at restaurants a lot?
• Can you cut back on daily expenses, such as coffee, candy, soda, or cigarettes?
• Do you have services you do not really need, such as cable television or a cell phone?

2. Set up a direct deposit and an automatic transfer to your savings account.

• When you get paid, put a portion in savings through direct deposit or automatic transfer.
• If you have a checking account, you can sign up to have money moved into your savings account every month. What you don’t see, you don’t miss!
• U.S. Savings Bonds can be purchased through payroll deduction.

3. Pay your bills on time. This saves the added expense of:

• Late fees
• Extra finance charges
• Disconnection fees for phone, electricity, or other services
• Fees to re establish connection if your service is disconnected
• The cost of eviction
• Repossession
• Bill collectors

4. If you use check-cashing stores regularly, you might be paying $3 - $5 for each check you cash. This can easily add up to several hundred dollars in fees every year. Consider opening a checking account at a bank or credit union.

5. If you get a raise or bonus from your employer, save that extra money.

6. If you have paid off a loan, keep making the monthly payments to yourself. You can save or invest the money for your future goals.

7. If you receive cash as a gift, save at least part of it.

8. Avoid debt that does not help build long-term financial security.
For example, avoid borrowing money for things that do not provide financial benefits or that do not last as long as the loan.
Examples include: a vacation, clothing, and dinners out in restaurants.
Examples of debt that helps build long-term financial security include:

• Paying for a college education (for you or your child)
• Buying or remodelling a house
• Buying a car to get to work

9. Save your change at the end of the day. Take that change and deposit it into the bank (every week or month).

10. When you get a tax refund, save as much of it as possible.

11. If your work offers a retirement plan, such as 401(k) or 403(b) plan that deducts money from your pay check, join it! Most employers will match up to $.50 on each dollar you contribute. The matched amount is free money!

12. If you decide to make investments, do your homework. Know what you are investing in. Get professional advice if you need it. You should have enough money in savings to pay for 2-6 months of expenses in case of emergency. Make sure you have an emergency savings account before considering investing in non deposit products.

13. If you own stocks, reinvest the dividends to purchase more stocks. Some companies offer an easy way to do this called a Dividend Reinvestment Program (DRIP). This process increases your investment faster, similar to compounding.

14. If you are interested in learning about investing, you might want to consider an investment club. The National Association of Investment Clubs (NAIC) is the corporation that supports this investment style. Investment clubs are groups of people who work together to understand the process and value of investing even small amounts of money (as little as $5-$10).