How to Make Your Savings Last Longer
You're ready to get your financial life in order and to do that it's time to save more and make your savings last as long as possible. Here's how to get started.
1. Make It a Habit
Want to make your savings last? It's all about building the habit for it. Saving is like a muscle that takes time to build and requires consistency. You can schedule automatic transfers from your checking to savings account to ensure that you're saving consistently. You can also use an automatic savings app like Digit to help as well.
2. Cut out What You Don't Need
Be honest, there are probably some expenses that you can cut completely or at least cut back on. If you go out for coffee several times a week, consider cutting back to once or twice a week. Go through your recurring expenses and subscriptions to see if there are any expenses that you don't need anymore. Ask yourself, "Am I using this enough to justify the cost?" and "Does this add value to my life?" If the answer is no, it's time to cut out what you don't need and free up those expenses.
3. Use Windfalls Wisely
Did you get some birthday money from a family member or a tax refund? Or perhaps you received an unexpected bonus at work? When you get a windfall, it's crucial to stash away some of your extra cash if you want to make your savings last longer. Windfalls by nature are unexpected and wouldn't be considered in your everyday budget. So before going on a spending spree, save for your future with your extra money.
4. Set Realistic Goals
In order to boost your motivation and stay on track, it's key to set realistic savings goals. If you don't have an emergency fund, set a goal of saving at least three months worth of expenses. Take inventory of your short-term, medium-term, and long-term goals and then write down or use the budgeting tool within KeyBank's HelloWallet tool to determine how much you want to save for each in a specific timeline. To understand what you can reasonably save, take a look at your income, budget, and current expenses.
5. Find a Financial Planner
Ready to turbocharge your finances and maximize your savings? Consider working with a financial advisor who can help you map out your financial future and guide you in the quest to make your savings last even longer. A professional financial advisor can give you personalized advice and get you on the right track to meet your savings goals.
6. Invest Intelligently
If you're ready to maximize your savings and make your money work for you, it's time to invest. Investing is a great way to beat inflation and play the long game when it comes to saving for your future. You can save money in a retirement vehicle like a 401(k) or IRA and invest in low-cost index funds to build wealth. Investing for the long-term is one of the best ways you can take charge and make your savings last longer.
Having money set aside in savings and investments is a key part of managing your personal finances successfully. You want to have money for all of your short-term goals while also having enough for your Golden Years. Using these tips, you can boost your savings and rest assured you have what you need, for what you want.