Last updated August 10, 2022 at 8:45 AM
Reach your savings goals while still paying your regular monthly bills and expenses. Does it sound impossible? Even with a tight budget it can be easier than you think. You just have to know the right strategies. One of the simplest tactics for building your savings account is to do it automatically using your bank’s automatic transfer service.
How it Works
Setting up an automatic transfer is a great way to gradually grow your savings account. Essentially it is paying yourself first and treating your savings as an expense. Save money for your child’s education, a vacation, an emergency fund, retirement or any other large expense.
Here’s how it works:
- Open a savings account with the minimum required deposit.
- Specify a fixed amount of money to be transferred from your checking account to the savings account.
- Specify how often you wish to transfer the money (every week, bi-weekly, monthly, etc.). Some banks give you the option to choose the exact day of the month for the transfer.
- Watch your money grow!
If you aren’t sure how much you can save, start small–even as little as $5 a week can really add up!
Benefits of Automatic Savings
Convenient. An automatic transfer is a set-it-and-forget-it strategy for reaching your savings goals.
Consistent. You’ll be depositing money into your savings account on a set recurring schedule. There are no checks to write and once it is set up, you don’t have to think about it again until you want to change your contributions or use your savings.
Interest and incentives. You’ll earn some interest on your money and some banks offer incentives for enrolling in automatic transfer programs.
Improve your spending habits. If you don’t see the money in your checking account, you are less likely to spend it.
Flexible. You can change the amount of money you transfer as needed. For example, if you get a raise, you can increase your deposit amount. You can also add funds to your account on a one-time basis, such as depositing a holiday bonus or tax refund.
Get on track to achieve your financial goals. Contact your financial institution to see if they offer an automatic transfer service.
Get started now and build your savings to reach your goals.
The information provided in this blog post is for informational purposes only. It should not be considered legal or financial advice. You should consult with a financial professional to determine what may be best for your individual needs.
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