If you want to get a better handle on your money, you need a savings plan. The challenge then becomes: how do you actually save money?
Whatever your savings goals are—college savings, an emergency fund, starting an investment account, or having enough to pay off your student loans—we understand that it’s tough to know where to start. Luckily, there’s an easy solution: an automatic savings plan. Using an automatic savings plan, you can put money aside effortlessly, and without thinking about it.
To get going, all you have to do is sign up for an automatic transfer of money from your checking account to your savings account. Having a personal automatic savings plan that can help you finally save money. For more inspiration, here are 5 reasons you need an automatic savings plan.
1. Pay yourself first
One of the most important things any financial advisor will tell you is to pay yourself first. You may already know that this is something you should do. But we know how it is—sometimes, it feels like your bills eat up your money before you have time to save.
When you have an automatic savings plan, however, you actually put “paying yourself first” into action. You do this by saving money through recurring transfers that are automatic. Once you’ve made these transfers, you can use your leftover money to pay your bills and spend in other ways. Look at it this way: instead of paying your bills first and then trying to save what’s left, you’re reversing the order.
Chime’s automatic savings feature deposits a percentage of your paycheck every time you get paid. This percentage will be deposited right in your Chime savings account.
2. An automatic savings plan will allow you to stop making excuses
“I can’t afford to save!” “Saving is too hard!” “What’s the point of saving?”
Any of these sound familiar? If so, you’re pretty good at making excuses for why you can’t save see the bigger picture for your financial situation. And it’s okay. We all do it. The brain is a powerful rationalizing machine. Our mind and our thoughts affect our behavior. So, if you’re making short-term excuses for why you can’t save, you probably aren’t saving.
Additionally, you know that relying on your excuses keeps you from future financial freedom, like planning your retirement or creating a solid emergency fund.
An automatic savings plan helps you combat these excuses and save money – no matter what.
3. You can set it and forget it
Saving is often difficult because it turns into just one more thing you have to do. Perhaps you say, “I’ll get to it later” and then life becomes busy and you don’t get around to it.
Yet, when you have an automatic savings plan, you can effortlessly save. Basically, a savings plan allows you to set it and forget it. You can rest assured that you are putting money aside each month and boosting your financial wellness.
Saving money is a part of responsible financial planning, but it doesn’t have to be difficult. Committing to saving even one percent of your salary each month through an automatic savings plan can help you build a cushion. You can even save spare change through money savings apps like Acorns and Chime.
4. Build an emergency fund & save for a vacation? Automatic savings lets you do both
Do you know the difference between a crisis and an inconvenience? Money.
Let’s say you lose your job or your car breaks down. If you have no cash set aside in an emergency fund, these things can turn into major crises. You can’t live without a paycheck and you need a reliable car to get to work. If you have money saved up for emergencies, however, you can pay for the problem and deal with it.
Having money in savings isn’t just helpful for dealing with the inevitable emergencies that pop up in life, but extra money can also help you pursue your dreams. Want to go on a once in a lifetime trip abroad? Want to get higher education? A personal savings plan can help you achieve these goals.
5. You can avoid procrastination with an automatic savings plan
If you haven’t started saving, you might think it’s too late to start now. But procrastinating won’t help you! There’s a saying that goes: “The best time to plant a tree was 20 years ago. The second best time is now.”
It’s never too late to get started no matter how old you are and no matter how much you can save. Through an automatic savings plan, you can beat the procrastination blues and take action today to create a savings plan that works.
The bottom line on automatic savings plans
We get it. Saving money can seem like a bore, a chore, or just one more thing to do. But it’s one of the best things you can do for yourself and your future.
When you create a personal savings plan, you’re actively investing in your financial wellness. So, why not set up a recurring transfer from your checking account to a separate savings account today? You can set the amount and the frequency of transfers. If you want to make it even easier, check out our money saving apps and begin your path right now.
This page is for informational purposes only. Chime does not provide financial, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for financial, legal or accounting advice. You should consult your own financial, legal and accounting advisors before engaging in any transaction.