Automatic Savings Plan

How often have you said to yourself that you would really like to save more each month but you just cannot afford it? While there are many things you can do to find ways to reduce your expenses, thus freeing up money for saving, I wanted to focus on an easy way to get started towards your savings goals.

Online Savings Accounts.
To start an automatic savings plan, sign up for an account with one (or all) of the leading online savings institutions, such as HSBCDirect, EmigrantDirect or INGDirect.

As noted in an earlier post, INGDirect is not paying the highest interest anymore but I have been extremely pleased with their web interface and the time it takes to execute my money transfers. If anyone is interested, contact me for a referral where you will receive a $25 account bonus and I will receive a $10 referral bonus.

While I haven’t done this yet myself, signing up for an account with all of the rate leaders will give you the flexibility to transfer money around in an attempt to chase the best rate. Just be sure to pay attention to any minimum account requirements so as not to be charged fees.

Automatic Savings Plan.
Okay, now that you have your online savings account established go ahead and create a recurring deposit to take place on a weekly or monthly basis. This is where you may be reverting back to the statement that you just cannot afford to save. If you find yourself saying that, I challenge you to create a recurring deposit for $1 per week.

What are you going to do with a measly $1 per week? To be honest, not much. But the point here is that you take the first step and start funneling money into your savings without having to think about. Once you have the automatic savings plan created, you will likely find that you do not miss that $1 per week at all.

Challenge Yourself.
As you find you are able to live without that $1 (or whatever amount) per week, challenge yourself to increase the amount of each recurring deposit. Try to increase your deposit by at least $5 but use any amount that you are comfortable using. The benefit to this is that you will increase your recurring deposit in small increments and likely come to the realization that you do in fact have money to save every month. If you do increase the amount too much, you can simply back the amount down to the previous level and use that as your standard deposit. Before you know it, your regular deposit will become a nice little chunk of change and you will be on your way to reaching your goals.

Take the challenge today and start an automatic savings plan with at least $1 per week!