24 Aug What do you need to do to start a savings plan?
What do you need to do to start a savings plan?
Determine your budget surplus – work out what you can do without on a weekly, fortnightly or monthly basis, and then ask yourself what you are prepared to put aside in order to meet your longer term expenditure objective, whether it be saving for a car, your child/childrens education costs, a deposit on a home or an even longer term objective of being comfortable in retirement.
It is important that it does not infringe on your lifestyle or feel like a hardship! This may mean commencing a savings plan with a nominal amount until you become comfortable with the process – believe me, once you see what you can achieve, you will increase it over time if it is an important goal that you are striving for.
The key is for your goal to be quantifiable and broken down into bite sized chunks so to speak, so that all along the way, you feel that it is entirely achievable. Apart from working out the budget, you need to ascertain what your actual savings goal is in dollar terms, what sort of timeframe you are striving for, and work backwards in order to determine whether it is possible or whether it requires some tweaking!
Please do not abandon your dreams at this stage – it may just be that you need to extend your timeframe, or maybe it requires a bit more of a financial commitment now in order to meet your longer-term goal. The most important aspect is to do something now, even if that means just setting up a separate bank account and a weekly direct debit. Don’t put it on the backburner or the too hard basket, or it will remain just a dream!