If you’re overwhelmed by handling your personal finances and not saving enough money, this advice will put you on the road to a solid financial life. We’ve come up with 4 tips for adding to your savings that you can start today! Adopting even one or two of these strategies will leave you ahead of the game, whether the economy is soaring or suffering.
Use an Automatic Savings PlanIf you find it impossible to save any money, you are not alone. Your safest choice to start saving money is an automatic savings plan. With a bank savings account, you can have the money automatically withdrawn from each paycheck and funneled into your savings. That’s a relatively painless way to force yourself to accumulate money.
Invest in a Money Market FundMoney market funds have been considered to be almost as safe as bank saving accounts and tend to pay higher interest rates. To find a money fund, check out websites like www.bankrate.com and www.imoneynet.com, which provide a list of the highest interest rates currently being offered. You can set up an automatic transfer from your checking account once or twice a month so it’s as easy as saving in a bank savings account!
Consider Investing in Stocks and BondsYou can choose to get more aggressive with your investments by taking advantage of stocks and bonds. The downside of it is that they’re riskier than money market funds. You can lose money by investing in them, so make sure you decide carefully how much risk you are willing to take for the chance to earn higher returns over time.
Start Contributing to a Tax-Favored Retirement Saving PlanYou may think retirement is too far away, but saving money in a retirement plan is one of the smartest things you can do – especially if you are young. If you work for a company that offers a retirement savings plan like 401(k), you should take advantage of it. If not, you should start investing in an individual retirement account (IRA). The most you can contribute to an IRA as of 2009 is $5,000 annually. If that is possible for you, contribute the maximum amount every year.
These are just a few tips on how to start saving more money, but now we want to hear from YOU! How do you make sure you keep adding to your savings?
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