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Automate Your Savings 9 Easy Ways

Automate Your Savings 9 Easy Ways

Daily bombardment by one-click shopping ads and an ever-present temptation to spend can make saving money challenging. Boost success and automate your savings with these nine easy steps:

1. Earmark income for investment.

Whether it’s babysitting money, all of the coins you receive in a month, or a portion of your regular paycheck, designate certain funds for savings and investments. Identify an account to funnel these earnings into and deposit them into that account immediately. No amount is too small; your savings will grow quickly through the benefits of compound interest.

2. Save your tax refund.

Looking for a lump sum to get started in the savings game? Save your tax refund, and pledge to do so every year. If your savings account already contains 6–12 months of emergency expenses, consider plugging your tax refund directly into your IRA.

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3. Regularly deposit into savings.

Automated deposits are easy and effective because they take money directly from your paycheck and put it where you need it – into a savings account that contains enough to cover at least six months of living expenses or foreseeable emergencies, preferably a year’s worth. If your savings account is already plussed up, reroute your automated deposit into investment accounts, such as mutual funds or IRAs. Contribute to a Health Savings Account or college fund if appropriate; or continue to build savings as you work toward a large investment purchase, such as a house or land.

4. Split your direct deposit.

If your employer offers direct deposit, ask if they will accept multiple deposit accounts. If they will, put some in savings and some in checking. If they won’t, set up a recurrent transfer on your pay day. Though they are both liquid, thanks to online banking, we tend to have a greater psychological resistance to spending money from our savings accounts.

5. Favor interest-bearing accounts.

Once you’re saving, make those accounts work for you! Do your research online, or call up a bank representative to learn which accounts bear the most interest at your institution. Often something as simple as keeping less in your checking, which typically has a low interest rate due to the fluidity of the account, and more in your savings, can result in larger gains over the course of the year.

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6. Use a cash-back credit card.

When you spend, do so with a credit card that earns you cash back. Like any credit card, remember to treat it like cash, buying only what you can afford at that moment and paying it off regularly.

7. Household accounts.

Some banks offer incentives for “house holding,” or consolidating checking, savings, investment, insurance, and other accounts at the same bank. Others offer cash incentives or higher interest rates to those who meet a certain threshold of net investment with the bank. This is free money, so it’s worth a call to your bank to find out if they offer such a program, or shop around for a bank that does.

8. Know your bank’s rules.

Some banks charge a fee after a certain number of transactions between checking, savings, and/or investment accounts per month, or cap the amount of money that can be transferred in a single transaction or 24-hour period. Know your financial institution’s rules, and plan accordingly.

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9. Automate bills.

You can’t accrue wealth if you are always being hit by late fees. Keep the lights on, and save yourself the cost of all those stamps, by automating as many payments as you can. Once you have a cash-rewards credit card, paying bills from your card can increase your benefits even more.

 

Want to save more money? Check out these 55 Practical Ways to Save Money Efficiently.

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Featured photo credit: 401(k) 2012 via flickr.com

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Last Updated on March 29, 2021

Life Insurance: A Secure Way To Protect Your Future.

Life Insurance: A Secure Way To Protect Your Future.

Life is a journey full of ups and downs. No one can actually predict what might happen the next moment; there are times where the happiest moments do not even take a second to turn into the gravest. Planning for your future can help you face such unwelcomed but irrepressible situations with much ease. We all want to make every memorable event of our life more special and to cherish all those moments happily and worry less, you must financially plan your future. But no one has control over life and death. Who would wish to see his family suffer in his absence? Insurance hands over the financial jeopardy of life’s happenings to an insurance company.

Importance of getting a life insurance

No one has control over life and death. Nobody would like to see their family suffering in an absence, and that’s why many people recommend life insurance. A life insurance plan is one of the best ways to secure the future of your family, even against those financial troubles after an untimely demise. These plans are safe and credible, and you could trust them for your family’s better future.

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On the other hand, a life insurance policy is a contract between a company (insurance provider) and policyholder in which the insurance provider ensures to pay a certain amount of money to the nominated beneficiary in case of the policyholder’s death during the term of the agreement. There are different types of insurance plans, and it is important for you to know the benefits of those plans such as a funeral, medical or some life expenses provided they are mentioned in the agreement.

Choosing the right insurance plan

If you’re about to select an insurance plan, you should consider some important factors:

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  • The time at which you start investing in a program and the number of family members you want to get insured. Obviously, a married man with two children has different needs compared to a single one. The number of persons who are dependent on an individual also varies from person to person.
  • The next thing you need to consider is you and your family needs. What are your child’s dream, your retirement plans, for how long would your dependents need financial support, any personal injury, etc. And do not forget those events or situations that will surely demand a huge sum of money.
  • The next thing one must consider is your current income. You should preferably choose a plan which you can afford.

Now you must be having a pretty clear idea of how to choose the best plan for you. Further, you should also compare various plans offered by different companies and numerous sites available online that help will you to compare them.

Differences between life insurance plans

Here’s a short brief of some plan categories you can choose according to your needs:

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  • Term Insurance Plan – You have to pay once, and your nominee gets the paid money under your misfortune demise. It ensures a person for a fixed time. If you survive the policy period, you do not get your premiums back.
  • Whole Life Policy – This plan continues for your lifetime. Under this, the policyholder has to pay regular premiums, until their death.
  • Endowment Policy –  In case the individual dies during the tenure, the beneficiary gets the amount assured. If the person survives the policy tenure, they gets back the premiums paid with other investment returns along with several other benefits.
  • Money Back Policy – In this a portion of the money invested is returned to the investor at regular intervals. If you survive the insurance term you get the entire amount back; else the beneficiary receives the entire sum assured.
  • ULIPs – These are the life insurance plans that offer you future security plus wealth creation options.

Many people do not opt for whole life policy and endowment policy because of the high amount of money you need to pay, while others may prefer to opt for these if they have a high life expectancy. Surely you will find the best one for you.

So what are you waiting for? Plan for your future and live a happier and carefree life today.

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Featured photo credit: aryehsampson.com via aryehsampson.com

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