Many people’s New Year’s resolution is to save more money, but this is easier said than done. Whether you’re trying to buy a house, pay off student loans, or take that dream vacation, here are 5 strategies to reach your savings goals in 2020.
- Set retirement goals in January (or on your birthday): Research has shown that new years and your birthday are effective times to set money goals. Enter a new year with a renewed commitment to your goals.
- Set specific, realistic goals: If your goals are too vague or extreme, it will be harder to follow through on them. Opt for something such as, “I will increase my savings rate from 5% to 15% over the next 5 years.”
- Make a detailed plan: Figure out the realistic steps needed to achieve your goals. If you’re considering a financial planner, research your options carefully. A good starting point is linking your credit card, loan, bank, and 401(k) accounts to an aggregation service and set monthly reminders to look at your service and get a better idea of your habits.
- Stress-test your plan: Consider potential obstacles to your plan such as unexpected expenses or spending temptations. Write down your goals and game plan so you’re more likely to stick to it.
- Use behavioral strategies that work for you: Learn to be patient with yourself. Consider making “if-then” plans, rewarding yourself for wins, identify spending triggers, and create visual reminders for yourself of what you’re saving for a why.
Incorporating more savings into your budget can be tough, but being persistent about planning and keeping your savings goals in mind can help you get there. Create a concrete, small steps and you’ll reap the rewards of your efforts in no time!