Stop Struggling With Saving Money!

Do you have a savings account? Or I guess the better question is do you have money in your savings account? If the answer is no, don’t be embarrassed! Many people struggle with saving money, not just you. Here’s why. Your money is usually deposited into a checking account, and from there, all of your bills are paid, and you use your debit card to make purchases either in the store or online. But what most people don’t have set up is automatic savings. Automatic savings is when a fixed amount of funds are automatically deposited into a savings account at specified intervals. Automatic savings is the number one key to getting money into your saving account.

Why Does Automatic Savings Works

Many people save money as a second thought. When they get paid the money goes to bills, expenses, food, and a bunch of other random things. The only time they saving money is when there is money left over. With this backwards approach there is never enough money to save. Once deposits are made into a savings account automatically and on a regular basis, you don‘t have to think about it and the money is deposited before to going to any bills and expenses. It doesn’t matter if you have $5, $20, or $100, saving automatically will guarantee money is saved every time you get paid.

How to Save Money Automatically

Thanks to innovative technology it is really simple to set up automatic savings. There are three methods I teach my clients to help them automatically save money. The method is based on budgeting skill.

Beginner Budgeter: Budget Dates

If you are new at budgeting, the best way to save automatically is not by having a computer do it, but by you putting your routine on autopilot. The way you do this is by setting up budget dates. It’s like a date with your budget. You set up a day and time around each day you get paid to transfer a set amount of money into your checking account. This will help you build the habit of checking your finances and saving money. This method is also good for people who do not have set pay days like freelancers or people who have inconsistent pay amounts.

Intermediate Budgeter: Bank Auto Transfer

If you’ve been budgeting for some time and got the gist of it down you can move your saving method to allowing your bank to automatically transfer your funds to your savings account. This is the most popular way of automatic savings and over the years banks have made this fairly easy. Simply log into your bank account and find the Transfer Funds area. Somewhere in there you should see the option to deposit money to another account with a different frequency.

I have PNC Bank so my Transfer Funds area looks like this. When I go into the system to do a transfer between accounts, there is a drop down for frequency. PNC gives a bunch of frequency options, way more than I would ever use, but they are extremely helpful. The frequency options are One Time Only, Weekly, Bi-Weekly, Monthly, Bi-Monthly, Quarterly, Semi-Annually, and Annually.

The only one I use is the bi-weekly option because I like my savings and pay to be on the same schedule. For me, it’s less confusing and super easy to manage.

For those who have consistent pay periods and pay amounts, this is the best option for automatic savings. If you don’t you might want to want to refer back to the previous method, budget dates.

Advanced Budgeter: Deposit It Before You Touch It

For those who have mastered the budgeting game, Deposit It Before You Touch It is the best method. This is when you set up a direct deposit to your savings account through your employer. It’s similar to how you do direct deposit for your checking account, but instead you’re depositing it into your savings account.

If you’re an advanced budgeter this is a good method because you already have your bills, expenses, and savings accounted for in your budget and you don’t have to worry about not having enough money to cover your bills and overdraft fees.

Final Thoughts

It all boils down to making sure you have money in your savings account, no matter what method you choose. Just make sure it’s right for you. That method should be something you can maintain over a long period of time. However, don’t be afraid to change it if you need to. As your money grows and your skills for budgeting, you’ll find that the method you used in the past may no longer work. Remember, your finance journey is about pivoting when things no longer make sense for your current situation.