Top Tips For an Aggressive Savings Plan

Use these top tips to create an aggressive savings plan to help reach your financial goals.

Top Tips For an Aggressive Savings Plan

Saving money doesn’t have to be a long, drawn out process. While retirement planning is something to think about for the long haul, you may have other goals in mind. Maybe you’re planning a wedding, saving for college, or wanting to go on the vacation of a lifetime. Whatever the reason you are needing to set up an aggressive savings plan, these tips can help you along the way.

Track your spend and stick to a budget

A budget is one of the best financial tools that you can have no matter your situation. Budgets are useful when you are trying to understand your expenses, how much income you actually bring in a month, and how much you are spending on discretionary and non-discretionary purchases.

Using a spreadsheet, track your monthly income, your mandatory monthly purchases (rent, mortgage, bills, groceries, etc.) and your non-mandatory purchases (subscriptions, going out to eat, coffee, etc.). Consider tracking your purchases for a month or two so you can get a good idea of where exactly your money is going.

Save first, spend later

Once your monthly income comes in, put your dedicated amount of savings into a separate account. In some ways, your savings should be “out of sight, out of mind.” Don’t forget about saving, but once it’s in an account, forget about it so you don’t spend.

Get out of debt

Getting out of a debt is critical for an aggressive savings plan. In fact, it should be a priority to get out of debt before you start saving. The high interest rates and monthly payments will do nothing but weigh down your goals. Consolidate your high-interest debt into a personal loan where you make a payment each month or use the “snowball method” to pay down your debt. You’ll start with paying off your smallest debts first and then move onto your higher ones.

Start investing now

It’s true, investing can be scary. Putting your money into the stock market with no guarantee of high ROI is a risk. Speak to a financial advisor who can help you with risk assessment and determine what investments you should put your money in. Investments are considered a long-term savings plan, so while they can be useful for aggressively saving, you need to think about them 10–30 years in the future, not for immediate spending.

Reduce monthly expenses

Once you’ve created and nailed down your budget, you can begin to cut down on unnecessary expenses. These expenses can be anything from going out to eat to your monthly subscription services. It doesn’t mean that you have to cut all the fun out of your life, but it does mean that you should consider what you can go without.

Reducing monthly expenses can be anything from downsizing your home to cancelling monthly subscription services to trading in your car so you don’t have a payment. It’s up to you how you reduce your expenses and there’s no one path for everyone.

No matter how aggressive your plan is, start now

Often, it can seem too late to start saving for retirement, an expensive trip, or other life events. An aggressive savings plan can help you along the way. It may take a while to adjust to your new way of living, but small steps will add up to big savings.

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