America Saves Week is a national opportunity to help consumers set savings goals as residents approach the time of receiving income tax refunds in the upcoming weeks. With the American personal savings rate at its lowest level since the U.S. financial crisis of 2008 with only 6 percent according to the U.S. Bureau of Labor Statistics and is continuing a 60-year downward trend.
“This is a week with a call to action for Americans to commit to saving successfully,” says Jeff Jackson, a First Horizon Bank regional president. “Everyone may participate by simply doing a ‘gut-check’ on their finances and saving behaviors before receiving their income tax refunds.
“The America Saves pledge is the framework that allows savers to set a goal, and make a plan to achieve better financial stability,” adds Jackson. “First Horizon Bank is proud to support this effort as one of 2,000 participating organizations, including more than 1,000 banks nationally. One of First Horizon’s pillars is to increase financial literacy in our communities. We encourage individuals and families to take better control of their finances and achieve financial stability.”
According to Jackson and the American Saves Week organization, here are five savings tips everyone should consider taking action towards:
1. Pay yourself first. By moving money from your checking to your savings account automatically is the easiest and most effective way to save. Whether saving for education expenses, a dream vacation, retirement or all things in between, this is one of the easiest ways to reach a goal.
2. Set Goals! Start by thinking of things important to save for. Are you getting married? Planning a vacation? Going back to school? Savers who have a plan are twice as likely to save successfully.
3. Save for “The Unexpected.” Use the 50-20-30 budget rule to save. Typically 50% goes to priority needs such as your mortgage or rent, car payments, utilities and groceries. Then 20% goes to savings which includes adding money to an emergency fund, making IRA contributions to a mutual fund account, and investing in the stock market. Commit that 30% goes to your wants; the non-essentials of movie nights (unless you’re a fan of Netflix) and tickets to sports games (or concerts.)
4. Retirement probably will arrive quicker than you may possibly realize. Preparing for retirement is especially hard when you’re focused on the here and now. It’s a fact that very few of us have a plan for retirement that is comparable to how we’re living now. So, save today for tomorrow!
5. Reduce your debt. This is something you don’t hear as often: paying down your debt is saving! When you actively reduce your debt, this results in saving on interest. When you pay on time, you save on late fees and maintain a higher credit score – which will save you money long-term.
