Saving money is not something that you want to take lightly. There are many things in life to save money for. Some things will not take you very long at all to save for, while others, like schooling, large purchases, and retirement can involve long-term saving, because they generally require a heftier savings. Here are some great tips to consider when trying to save long term.
#1. Know Your Financial Goals
The most important thing to consider when you are saving long term, is what is it exactly are you saving for? This is key to knowing how much you need to plan for, and what kind of time frame you will need to have to save up that amount of money. This is also highly important because knowing what you are saving for can help keep you motivated. Saving money can be a drag, but having a prize at the end of the road will help make it all worthwhile!
#2. Take Advantage of Opportunities
There will be times when opportunities will be available to you to help you save even more. For example, many employers will match your 401k retirement savings up to a certain percentage or dollar amount. If this sort of option is available to you, there is no reason not to jump on board and get your paperwork filled out as soon as possible.
#3. Know the Terms of Your Savings Accounts
There are numerous different kinds of accounts that you can place your money in for a better long-term savings. But with each account comes a different set of rules, such as how much interest you will be making, and penalties for withdrawing funds earlier than you are supposed to. It is highly important to do your research on the different accounts to see which one will be the best fit for you, personally.
#4. Don’t Pull Your Money Out Early
More and more people have long-term savings, but they decide to pull it out early. Make this a last resort. You don’t want to pull out your retirement money early and then you don’t have money to fall back on as a retiree.
#5. Put Your Money Where You Can’t See It
When you see your money, every day, in your checking account, it’s easy to spend it. The trick to this is to put your money where you can’t see it or don’t have easy access to. Let’s say you’re saving for a roof, it makes sense to put that money in a bank account that you can’t see, so it’s there when you need it most.
#6. Consistency is Key
When it comes to saving money long term, consistency is key. You want to ensure you are saving money, so keep putting money back, when you can. If you only save money 1 week out of 4 weeks of pay, you aren’t going to reach your long-term money savings very quickly.