Falling behind on your savings goals can happen in a flash (or maybe just one too many swipes of your credit card). All it takes is an unexpected bill that forces you to stray from your monthly budget or broader financial plan.
In fact, it’s unlikely that you’ll never fall behind on your short-term or long-term money goals, so it’s important to remember that following better money-saving tips now is a good investment in your future.
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What you don’t want to do is get discouraged when you fall behind, so whether you are just opening a high-yield savings account or focused on saving for retirement, reaching your goals is always an option. The key is to put a plan in place to catch up as quickly as possible — and there’s no time like the present to start saving.
If you’re behind on setting savings goals or just want to build an emergency fund, here are some things you can do this week to catch up.
Grow Your Savings
Interest rates have ballooned in recent years, thanks to a series of Federal Reserve rate hikes designed to tame inflation. This can wreak havoc on your financial goals and if you haven’t done so already, now is a good time to take advantage of high interest rates by opening a high-yield deposit account such as a CD or money market account.
The power of compounding interest is a beautiful thing. If you’re keeping your money in a traditional savings account, you’re probably missing out on free money in the form of higher APYs elsewhere.
All savings are good savings but when you’re putting those numbers through a savings goal calculator, make sure you factor in how much money you can earn on your deposit account.
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Automate Your Savings
Once you’ve established an FDIC-insured account that pays you competitive interest rates, set up an automatic transfer to ensure you add to it regularly. Many consumers set up monthly deposits, though you could do it more often to help build your savings even more quickly.
Most banks and credit unions give you the option of setting up automatic savings either on their websites or through their mobile apps. You could also have your employer make direct deposits into the account each pay period.
Review and Adjust Your Monthly Budget
Catching up on your savings goals often means finding room in your finances when creating a budget that will allow a greater amount of money to move into your savings each month.
The first step is to evaluate your budget and identify potential areas to cut back spending. Think of items you can live without, such as subscriptions or memberships you don’t use that often.
If you dine out regularly, you’d be surprised how much you can save beginning this week by cooking at home instead. The key is to live well below your means, so you can put the extra money toward accelerating your savings to get back on track.
Find New Sources of Income
When it comes to figuring out how to save money, cutting back on expenses is one way to bolster your savings. Another way is to find new ways to earn passive income. This can come in the form of identifying investment opportunities to help grow your wealth, such as setting up an account with an online broker.
The focus here should be on historically reliable, long-term returns that will eventually complement your bank and retirement savings. Side hustles in this gig economy are plentiful so you can pick and choose based on your schedule or skill set.
A quicker way to boost your income is to find a part-time job or side hustle that puts your free time to use earning money. Side hustles and part-time jobs can range from becoming an Uber driver or sales rep to serving as a professional consultant. Take stock of your skills, experience and expertise and think of ways to monetize them.
Prioritize Savings When You Run Into Extra Money
Another way to start catching up on your savings this week is to put any extra money directly into your savings account. This might come in the form of loans or other debts that you have paid off. When you find yourself with one fewer bill to pay, move the money into savings rather than spend it.
The same holds true if you get a work bonus, commission, stock dividend, product rebate or any other temporary boost in income. By prioritizing your savings, you’ll catch up on your savings goals a lot faster.
Max Out Your Retirement Accounts
If you have a company-sponsored retirement account such as a 401(k), or an individual retirement account (IRA), start maximizing your contributions this week, if you can afford to do so.
In 2024, the annual limit for 401(k) contributions is $23,000 if you’re younger than 50. If you’re 50 or older, the catch-up contribution is $7,500, and the limit for IRAs is $7,000 for those under age 50 and $8,000 for those age 50 or older.
Contributions to these accounts are pre-tax, which reduces your taxable income now, but lets your money grow tax-deferred until you retire. The only money move that feels better than improving your credit score would have to be lowering how much money you pay in taxes.
If you can’t contribute up to the maximum, contribute at least enough to get any available matching contributions from your employer. This is free money you don’t want to miss out on. By maximizing your retirement plans, you at least know that one of your savings accounts will enjoy accelerated growth while you catch up on the others.
Vance Cariaga contributed to the reporting for this article.
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This article originally appeared on GOBankingRates.com: 6 Things To Try This Week If You’re Behind on Your Savings Goals
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