Week 6 – Automate your savings

Hi there! Welcome back to the 8-week challenge!  I hope the past 5 weeks have helped you improve your financial wellness. This week’s challenge is to automate your savings (or pay yourself first).

Week 6: December 14 – December 21

Financial Wellness Challenges – Activity for the week:

Automate your savings 

Send money to a savings account before it is deposited into the bank. Or you can have money automatically sent to a retirement fund (IRA, Roth IRA, or 401K plan).  It’s easier to save money when you don’t have it to spend!

It may be tough to think about saving money when you have a lot of bills to pay, but if you think of saving money as paying yourself for your future, it may be easier for you.  If you realize that extra spending now is taking away from your future retirement plans, you may be able to resist the temptation.  Automating your savings for retirement not only makes sense but also makes it so much easier to save. 

Many people struggle when it comes to finances, time to automate your savings.

According to a news article from CNBC, in November 2019- when the economy was booming and before the Coronavirus pandemic, only 29% of Americans felt they were at least satisfied financially. This leaves over 70% who do not feel financially well. The best way to save money is to not have it easily accessible to spend.

The best way to do this is to set up an automatic savings account or retirement account.

1. 1. Direct deposit in a savings account: “Pay yourself first,” by having money from your check directly deposited into an interest-bearing cash savings account such as Aspirations or SmartyPig. 
   2. 401K: Another way to save is to take advantage of your employer’s 401K plan. A 401K is a retirement plan that employers offer. Employers normally set an amount that they will match as part of your retirement package. 
   3. IRA: You can also put your money in a traditional IRA account or a Roth IRA.  Both plans offer tax breaks. Most banks and retirement plans allow for an automated method of deposit from your checking or savings account.

• APPS:  Digit, Acorns, Stash, Robinhood, and SmartyPig are some of the most popular money-saving and investing apps that I have found.  Some of these apps help you save money by rounding up your spare change on common purchases and will even invest those extra coins in stocks for you! They are easy to set up and easy to get started. 

Remember, all of the challenges are designed to help you improve your financial habits to help you lower your debt and increase your savings, so you can feel better about your finances and work your way towards financial wellness.

Be sure to tune in next week for our next challenge!