Here are 4 simple steps for setting savings goals:
First and foremost, you need to determine what you are saving money for. Do you want to take the family on an overseas trip? Buy a new car? Refurnish the house? Once you have identified your goal, you can then determine how much money you will need to save to achieve that goal.
Setting a timeline will provide further motivation to meet your savings goal. For example, you may decide to take an overseas trip in twelve months’ time, or have a deposit saved for a house in two years.
Once you have set a goal and determined a timeline, you now need to work out how much you will need to save each month. For example if you your goal costs $1,200 and your timeline is 12 months, you will need to put aside $100 a month. If you cannot afford $100 a month, you may need to rethink your timeline, or perhaps re-work your budget and look at ways you may be able to achieve the payments. It is important that the plan is realistic to be achievable.
Setting up auto payments of your pre-determined savings amount will ensure the money is deposited into your savings account every month. If you are not sure how to do this, contact your bank or credit union and they will be able to help you.
There are some handy tools online for setting savings goals such as this Saving Goal Calculator.
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