America Saves Week is Over, but Your Savings Journey Doesn’t Have to End!
Published on April 12, 2024
America Saves Week has been all about growing your money. We want to set you up with a strong savings strategy that will help you, and your family, reach every financial goal and beyond.
In our first article this week, we talked about automatic savings and saving for the unexpected. We understand, however, you may have more or different savings goals including homeownership, weddings, paying off credit card debt, or finally making that last car payment.
Saving for Major Milestones
It’s never too early to start saving toward important life milestones, even if they’re years away.
If you’re waiting for the housing market and those high interest rates to change, take this delay as your sign to start bulking up that house fund. Save as much as you can, even if it’s a little at a time, so that two, three, or even ten years down the road, you’re not starting from scratch.
The same goes for important celebrations like weddings, birthdays, or anniversaries. You know they’re going to happen… so why wait to pay it all out of pocket?
This all starts with a Membership Savings account, but as you start to grow your savings, an account that earns a higher rate could be the next logical step—moving you even closer to your goals.
Paying Down Debt is Saving
The longer your credit card bills stay high, loans don’t get paid, or other interest-accruing accounts are active, the more money you’re losing. Interest collected on these cards or loans could be a big set back on your personal financial journey if you’re not smart about that pay off plan.
With inflation and the overwhelming costs that most Americans are facing right now, using a credit card is sometimes the only option in a pinch.
If you’re in an emergency and don’t have the money for food or necessary bills, know that it’s okay to use what resources you have available, like credit cards, to take care of you and your family. Just make sure you’re prepared to tackle that expense the second you have the extra funds.
Be cautious about opening a personal loan to cover everyday expenses or bills. Not every personal loan is the same, and some can be predatory with insanely high interest rates. Be sure to explore your options thoroughly to lock in the best rate, and to make sure there you’re taking advantage of specific loans that are built to help you cover certain costs.
When it comes to credit cards, set an aggressive, but realistic automatic payment to be taken out each month—preferably over the minimum payment. Then, as much as you can, try not to use the credit card. You’ll want to see the balance and accrued interest go down, and making a payment one day and using it the next won’t allow for that to happen.
If you need to use it, make sure you have a strategy for how you’re going to tackle the additional cost. Maybe cut back on your spending that month or make a bigger payment the next month—the sooner, the better.
With loans, being aggressive on your payments can also help you get rid of debt quicker. Remember—the more you can pay now, the less interest you’re paying later.
Battling credit card or loan debt? You can start to tackle it in one of two ways:
- Avalanche Method: Pay as much as possible every month on the highest interest debt and maintain minimum payments on everything else. Once you pay that one debt down, take that payment and apply it to the next highest interest debt.
- Snowball Method: Do the same thing as the avalanche method, but with the smallest debt and work your way to the biggest debt.
Don’t forget—saving is for everyone at every phase of life.
If you’re young, building a strong, healthy financial history can help you achieve goals and save money for your future. Don’t look at an investment like an IRA as a ‘later’ issue, because when later comes, you don’t want to be behind.
For our members looking toward retirement and beyond, savings is just as important as it was the day you opened your first bank account. Whether it’s for emergencies or gifts for the grandchildren, make sure you’re putting that safety net away into an account that makes sense.
