Are you nourishing your savings and retirement accounts the way you need to? It can be overwhelming at first, not knowing where to start and how you're going to reach those primary saving goals. As a finance blogger, I get overwhelmed at times reading articles, and I feel like if I started saving for every single item magazines and blogs told me to, that I'd have no money left over to live or have a good time. After much research, I'm here to suggest there are really only two savings rules you really need to follow when it comes to successfully meeting your goals:
1) Just do it
2) Make it personal
Savings Rules – You Just Gotta Do It (a.k.a automate)
Don't beat yourself up if you aren't contributing as much as you need to or can to your savings goals. The important thing to remember is that you are (at least…I hope you are?) saving. If you get down on yourself, you are more likely to overspend and you will have saved less than if you had just set a smaller, less ambitious goal. (We like these apps that save for us automatically.)
What is the recommended amount to save each month? About 20% of your take-home pay, if you're using the 50-30-20 budgeting strategy. So if you make 2200.00 per month after taxes, that's 440.00 you should put away toward debt repayment AND savings. You should adjust this if you live at home to probably around 40 or 50% since you have no living or “fixed” expenses. Alternately, I live alone in an expensive city, so I am only able to contribute about 17% to my goals. Do I beat myself up about it? No.
Many recommend you put the entire 20% toward debt repayment if you have it, but for young women who have a high burden of student loans, this is just not realistic. If you have high consumer debt, such as a car loan or credit card, try 15% towards paying those off and 5% towards savings. Just save something! You will never know when you need it.
A Real Life Example of Why You Just Need to Start Saving Something for a Rainy Day
I recently had to dip into my “emergency fund” when my boyfriend and I split and I had to move out of the apartment we shared. Expensive and awful, but I am so glad I had that cushion to help me.
Trust me – down the road, you will get so excited by the tiny amount you have saved you'll kick it into high gear. I had a girlfriend who put away 10 dollars per week for four years and went to Italy. The holidays can be a tricky time, and I would much rather you put your savings on pause than rack up debt to finance your Christmas.
Still, saying you saved $25 or $50 will go a long way toward making you feel empowered during an otherwise financial cluster of a season. Seriously, just do it.
The Most Important Savings Rule – Make it Personal
So, you are saving like a good girl, but you aren't consistent. Maybe want to kick it into high gear. Most people are only successful with savings when they make it PERSONAL. Do one better and make it personal and put a concrete timeline on it. Most savings goals should have a start and an end date, like a race. Be competitive with yourself.
It doesn't matter what your goal may be: a house, a child's college education, a 30,000 dollar wedding. Even smaller goals can be super effective: saving for vacation, a certain jacket, purse, or trying to pay off your Christmas presents in full instead of putting them on your credit card. If you make it personal, your chances for success increase exponentially.
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