TOP DRAWER ARTICLE

Savings Strategies
by
HL Carpenter

Is your savings account looking skinny? If so, consider these five strategies. They may fatten up your bottom line.

1. Save your coins. Got coins jingling in your pockets? Drop that loose change into a jar every day. At the end of one month, count up how much you’ve collected. You might be pleasantly surprised by the size of the deposit you can now make to your savings account.

2. Track your spending. Review your credit card statement, or set up your financial software to download transactions into designated spending categories to find out exactly where your money is going. Adjusting outflow can add up to more money in the bank or a credit card with a zero balance.

3. Stop before you shop. Ask yourself if you need the item - or if you just want it. You don’t have to deprive yourself, or feel guilty about your purchases. But when you’re aware of your motivation, you might find yourself spending less and saving more.

4. Profit from windfalls. Just paid off your car, received a raise or a tax refund? Since you were getting along without that money before, don’t spend it now. Stash it in treasury bills or a high yield certificate of deposit.

5. Sign up for automatic investing. Most mutual funds let you establish regular investment transfers from your checking account to your mutual fund account. Another option: Set up an automatic payroll deduction for contributions to your company’s retirement plan.

Originally published May 2007.

Last update: January 8, 2011