It’s always a good time to start saving, especially if your primary goal is to reach financial security. Saving is one of the simplest yet most important steps you can take to build a strong financial foundation. The guide below includes several money-saving tips that can help you grow your rainy day or emergency funds. 

6 money-saving tips to help establish financial security.

Saving money starts with knowing where you’re at financially and where you want to be. While setting aside money every paycheck is a great start, there are many ways you can contribute to your savings. As you explore the money-saving tips below, think about specific, actionable steps you can take to set aside more money. 

1. Take stock of your finances.

Start by reviewing your current financial situation to determine your cash reserves, any outstanding debts, and any large upcoming expenses. Review your credit report and credit score to determine your eligibility for taking out a loan if necessary. Gaining a clearer understanding of your finances will help you to identify the gaps you need to address. 

2. Review your monthly budget.

List your essential expenses, including your rent or mortgage, food, transportation, and debt payments. Then, identify areas where you can reduce spending every month and redirect that money to your savings. Dividing your spending into needs and wants also makes it easier to determine what you can cut or where you might find a more affordable alternative.

One easy and effective way to manage your spending is to use the 50/30/20 rule. This rule suggests that 50% of your income goes to your essentials, 30% to your wants and 20% to your savings. If you’re particularly savings-oriented, it may be beneficial to swap these percentages, to allocate 30% toward savings and 20% toward wants instead. 

3. Streamline your debts.

Prioritize debts that must be paid on time, such as your mortgage, rent, and car loan. Consider asking your credit card issuer for a lower interest rate, especially if you’ve been a loyal customer with a solid history of paying your bill on time. You may also want to consolidate your debt—especially high-interest debt—into one fixed-rate loan. This can help you streamline your outstanding debts into a single monthly payment. 

4. Prioritize savings.

Try to save enough to cover at least three months of expenses—six months if possible—in an emergency fund. You might find it helpful to open a dedicated savings account specifically for this purpose. Once you’ve opened your account, automating your contributions can help you build your emergency fund steadily over time.

5. Open high-yield deposit accounts.

Certificates of deposit (CDs) and money market accounts typically offer higher interest rates than with traditional savings accounts, helping your money grow faster. CDs and money market accounts are both low-risk savings methods that can help you grow your emergency fund. Most banks offer money market and CD accounts designed for larger balances. However, the terms can vary between individual financial institutions, so it’s a good idea to compare your options before opening an account. 

6. Saving for retirement.

Consider opening an Individual Retirement Account (IRA) if you don’t already have one. Traditional and Roth IRAs can help you tailor your contributions to your long-term savings goals. Both IRA types also offer tax advantages. 

If possible, try to avoid withdrawing money from your retirement funds early. If you aren’t 59 ½ years old, you’ll be penalized for withdrawing funds early. If you do need to take out funds for an emergency, explore what options you may have for temporarily withdrawing funds and then replacing them to avoid any penalty fees. 

Looking forward: How to maximize your savings goals.

Saving more from each paycheck can help you build a strong financial safety net. Along with establishing good savings habits, selling things you no longer need (like electronics, furniture, or collectibles) can help give your emergency fund a quick boost. You can also make the most of your spending with rewards-based checking accounts and credit cards to earn back some of what you spend. 

Find value in what you have.

You might be surprised—there could be money sitting in your home in the form of things you no longer use. For example, you can sell gently used clothing, jewelry, tools, or car parts online. You could also host a community garage sale. Selling items you no longer need can help you bring in some extra cash that you can put toward your savings goals or future expenses. 

Leverage interest on checking accounts and credit rewards.

You can help grow your savings by opening a checking account that earns interest on your balance. It’s a simple way to make your money work a little bit harder. Credit card rewards can help offset everyday expenses, like gas, travel, dining out, and college costs, among other expenses. Responsible credit card management can help you build a strong credit history, and, over time, this can lead to greater savings through lower interest rates and more favorable loan terms. 

Safeguard your finances with proper account management.

Responsible money management is vital to your financial health. Checking and savings accounts can help you better manage your money and prepare for potential financial struggles. Contact our Customer Care Center or visit your nearest branch to learn more about opening a checking or savings account today.