Setting Up Long Term Saving Goals
If you are one of those people that are able to save just for the heck of it with almost no effort required, then.. wow, keep doing you! But, if you are like the rest of us and you require an extra push to be able to save for something you need next month not to even talk about years down the line, then this post could help you!
Long term saving is important because it gives you a long period of time to work towards being able to afford something or live a certain lifestyle that might have otherwise been impossible (or super difficult).
The question now is: how do you even get started? We have some steps you can use:
It’s one thing to dip into your savings of X amount of money but dipping into Sammy’s college fund? that hits different no?
- Don’t just set a goal, name it!
So, you want to save up X amount of money in 10 years, that’s a great goal but why? Is it for you daughter’s college tuition? then call it Sammy’s college fund! This will help you identify personally with your goal and also help keep you going when it might get tough to continue saving. It’s one thing to dip into your savings of X amount of money but dipping into Sammy’s college fund? that hits different, no?
2. How much EXACTLY are you planing to save each month?
To avoid being able to talk yourself out of it sometimes, it helps to have a set amount each month you plan to save towards your goal. Take your time to set it and then make it non-negotiable (except in dire circumstances). Ideally this amount should not be the exact amount you need to hit your goal at the end of the time period, let it be a little higher to give a bit of padding just incase.
3. Automate the process as much as possible
The less involved you are in the actual tranferring of the funds from where it is to where it will be saved, the better. One way to do this is to get a standing order from your bank to transfer the set amount from your account to where you have decided to save, that way, at a set time (determined by you) the money is safely tranfered without you “Forgetting” to do it 🙃. Another option is to sign up on an app that helps you save that could also automatically (with permission from you) remove the funds from your account and stash it somewhere safe.
4. Decide where to “stash it”
You know what you’re saving for, how much you’re saving per time and how you will save, now it’s time to decide on where. You have options ranging from low risk to high risk ones. For long term savings, we would suggest you stick with low to medium risk options. Some options in that range would be savings accounts (different banks have different policies for their savings accounts so it would be useful to compare and pick the one you are most comfortable with) and low to medium risk investment options (this varies accross sectors and timing so before you choose one, be sure to do your research! If you are using an investment app, ensure to check the estimated risks before you jump in)
With these steps, you should be able to set up your long term saving goals… and meet them! If you have any questions, feel free to leave a comment.
