Setting your savings goals is as easy as imagining a number and saying that’s what I want. It’s not enough to just say I want to save this much or that much. Setting your savings goals is one thing, and reaching your savings goals is a whole other thing.
A short answer to the question of how to reach your savings goals is to monitor your spending habits and find the right balance between your assets and liabilities that allows you to save some extra cash. What you want is to make sure you’re not spending money on things you don’t need and be reasonable in your savings goals.
In this blog post, I will tell you some of the best tips I use to reach my savings goals whenever I need to. These strategies usually work for me. And hopefully, you’ll find some good insight here. So, shall we?
1. Be Reasonable and Specific in Your Savings Goals
First, you have to define your savings goals and be reasonable in your expectations. Whether you are saving for buying a home, sending your kids to college, or just a vacation, being specific and reasonable is the first step towards reaching your goal. You don’t just throw in a vague idea or a number that’s not too reasonable. Part of what will motivate you to reach your savings goal is having a very clear idea of where you’re heading.
It’s time for you to sit by yourself with a pen and paper and start thinking seriously.
2. Be More Careful in Your Spending
In my case, part of what really drained my bank account is the amount of unnecessary stuff, I buy every month. I used to spend too much money on junk food and treats that didn’t serve me in any way. Aside from subjecting my health to too much unhealthy eating, I also jeopardized my finances.
Identify the spending habits that you can do without and eliminate them. This is different for everyone so there’s no need to tell you exactly what to do. If you’re plagued with poor spending habits, then you probably know exactly what I mean.
3. Set a Deadline and Respect that Deadline.
Having a deadline is always good. What you should be aiming for is to reach your goal before the deadline or exactly at the time of your deadline.
I personally find myself very motivated when I respect my deadlines. What I usually do is save a little bit extra money each month or week to reach my deadline before its time. It makes me very proud of myself when I reach my deadline before its time. And it also allows me to save some extra money above my already-planned savings goal, which I use to spoil myself, knowing that I deserve it.
One tool that really helps me in this regard is an online savings calculator. The point is to use technology to your advantage.
4. Set Multiple Accounts for Various Savings Goals
At times, you have multiple saving goals. Some are more prioritized than others. For example, if you’re saving for a home and college for your 9-year-old boy, buying a home should be a priority. Instead of saving for both the home and college for your kid, set two accounts or even more.
You can deposit money for the home on a monthly basis because it’s a priority. And as for college for your kid, you still have six years. One of the best approaches is to save money on the college account every three months.
I mean, you get the point; don’t put all your eggs in the same basket. You should also set aside an emergency account and similar stuff. And those accounts should not be touched. Only input, no output.
4. Monitor Your Spending Habits
While this might be a hard thing to do, i.e., keeping track of everything you spend, it’s actually feasible. You can use a spreadsheet you visit every day before dinner or go to bed. You will go through everything you spend during the day and see where your money goes.
It won’t take more than 15 minutes a day, and it will prove to be very useful.
5. Instead of Having Big Goals, set Micro-Goals
Saving $30 every day will accumulate to $2,700 in three months. If you can save $2,700 every three months that will accumulate to $32,400 in three years. You get the point.
It starts with setting a daily goal, a weekly goal, then a monthly goal. The journey of a thousand miles starts with one step. And as the old saying goes, “take care of the pennies and the pounds will take care of themselves.”
6. Automate your Savings Goals Using technology
In our day and age, many services and apps help you automate your savings and overall finances. A smart person is a person who uses technology to their advantage. All it takes is a simple Google search for how to automate your savings, and you’re good to go.
As long as you have well-defined goals and you’re able to discipline yourself to reach your financial goals, nothing can stop you from saving the amounts you want and reaching your goals. And if you ever want to expand your financial horizons, you can always use your time more productively. With the internet making it easy to start a career as a freelancer, anyone can make some extra bucks on the side whenever there’s a need.