How to Grow Your Savings

build your savings

Growing our savings has been a big financial priority for us this year. Not only is it just a good idea, but it’s also necessary if we want to reach our goal of buying a home in the next year or two. Whether you have a big goal that you’re saving for, or are just wanting to build up your emergency fund or save for your next vacation, here’s some tips on how to grow your savings:

Set up an account that works for you

The first step to saving is to create a dedicated account for the money. There are plenty of options out there today, including savings account that are attached to your checking account at your bank, Capital One 360, PayPal, and many more. Do your research and choose the one that sounds like the best fit for you. If you’re starting off with a healthy balance, then consider a high yield savings account that you can build upon.

We set up a savings account with our bank that’s attached to our checking, and every time that we make a purchase or payment with debit, a dollar is transferred over to savings. This is a nice little way to ensure that money is being saved. It also makes it easy for us to automate a transfer of a set amount each month into savings without having to even think about it.

Pay yourself first

I’m sure you’ve heard this before, but perhaps you haven’t started to put it into practice. If not, consider doing it now! Maybe you don’t make a lot of money, or you don’t have a lot of wiggle room in your budget- that’s ok. You can still pay yourself first by taking a small amount from each check and putting it right into your savings. Do this before you pay bills, go shopping, head out to dinner or the movies, etc. Make paying yourself first a priority, no matter what.

Make savings a budget category

Your savings account (or accounts) should be a priority, whether we’re talking retirement, emergency fund, vacation fun, or just rainy day savings. To make sure that it doesn’t get overlooked, make it a category in your budget. This is ideal if you’re going to be adding the same amount each month, but it still works if the amount fluctuates. The point is that you have it accounted for.

Trim the fat

You should be going through your budget every so often to keep tabs on things anyway, but it’s especially helpful when you’re trying to grow your savings. Go through each budget category and see where you can trim the fat. Take a hard look at variable spending, and see what can be let go of. For those fixed expenses, you may be able to get your bills lowered by negotiating for better rates. Why pay $100 every month for phone service when you could be paying $30? That $70 difference could be going into your savings account each month.

Make smart spending decisions

Ultimately, nothing will save you more money than simply not spending. Make smart spending decisions, especially when it comes to big purchases. If you want to grow your savings quickly, you need to be aware of how every dollar you spend will affect your goals.

It takes effort to grow your savings, and unless you come into a financial windfall, it won’t happen overnight. With a little planning, you can keep your eyes fixed on your goal and watch those numbers go up every month.

About Lauren

Lauren May is a freelance writer and travel lover living on a budget.

16 thoughts on “How to Grow Your Savings

  1. Making savings a part of the budget has really worked well for me. I’ve found I’m much less likely to make unnecessary purchases because I’ve already moved the money out of the account to savings, so it feels like its unavailable. Its a great feeling knowing that the savings & investment dollars are already taken care of.

  2. I like the idea of automating your savings. This has worked really well for me over the years to set it and forget it! This also helps me to ensure that I pay myself first 🙂

  3. Hi Lauren,
    Automating your savings and treating it like an expense is so important. I recently came across your blog and I’m very impressed. This world of blogging is all new to me. I’ve always wanted another outlet outside of my 9-5. I started a blog two days ago and it has been so great to get my thoughts out there. If you have any advice for me I would greatly appreciate it. There seems to be so many aspects of setting up a site, collaborating with others, developing content, etc. that it’s a bit overwhelming. But I’m looking forward to embarking on this blogging journey.

    Best regards,
    Dane

  4. I think the biggest issue is making sure that the money you save from trimming the budget actually makes it into savings. So I created a Saved Savings account.

    Each month, I put the money we save from switching to Hulu into the account. And when I save money with a coupon or a sale, those savings go in too. Also, money from cash back shopping.

    We’re able to put away an extra $150-200 each month.

  5. These are all great ways to save money. I have the money come out of my check automatically from the top and it really works. Once you saving and you see those dollars start to stack it gets addictive and you just can’t stop.

  6. I am a big fan of paying yourself first, it’s actually the first thing I get clients to do and when we meet for their quarterly meetings they always wonder why their accounts are so high and it’s pretty much from automatically paying themselves before any other bill.

  7. We have approximately a zillion sub-accounts. There was an HVAC account when we were, well, saving for an HVAC. We put away money each time we do laundry. I put away the $92 we save each month now that we don’t have cable. And there are set amounts to put in vacation and car funds, as well as a minimum to put in savings.

    It’s been a huge boon to our ability to save.

  8. Great tips, pay yourself first goes a LONG way. Stashing your savings somewhere so you don’t see them is a great way to avoid spending your savings.

  9. Great tips! Paying yourself first is a big one with me. Whenever I get paid I can’t wait to transfer money to my savings account and watch it grow. I also create a budget category for saving and I’ve been using Capital One 360 for a few months now and I love it.

    1. Oh good to know that you like Capital One- I haven’t tried them yet, but I’ve considered it for awhile. I could always use another savings account 🙂

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