You may want to start saving.  Most people do!  They know that having money set aside for future needs or goals is good financial practice.  But starting is often the hardest part.  Here are some steps to take if you want to start saving.

Step 1:  Make the decision to save.

Saving money starts with the decision to save. 

Step 2:  Have a reason to save.

Make a savings goal.  Saving generally is good. Saving for a goal is better.  Why?  You are more likely to stay motivated if you are saving for a goal that is important to you. 

Step 3:  Figure out how much you can afford to save.

To do this you may have to start by making a budget.  If you’ve never set up a budget, start by tracking your spending.  This will give you a clearer picture of how you are using your money now.  This information will be helpful in finding some areas where you can cut your spending.  Wherever you cut your spending is money that can be put into savings.

Step 4:  Figure out where to save your money.

In addition to having a savings goal and figuring how much you can afford to save, you will need to figure out where to put the money you’ve saved. It shouldn’t be in a place where it is easily spent.  You can put it under your mattress, in a cookie jar, in an account at a bank or credit union, or on a prepaid debit card.  Each of these options comes with benefits as well as risks.

Step 5:  Make a written savings plan.

Writing things down helps to make them a priority. Use the tool to create a savings plan, which will include:

• Your savings goal
• The amount you want to save in total and then either weekly, monthly, or by paycheck
• How you are going to find that money to save
• How you are going to make the savings happen—by putting cash aside, direct deposit, or another way
• Where you are going to put your savings

Like a budget, your savings plan will be an important part of building and maintaining your financial health.

Should You Save if You Have Debt?

The answer is generally, yes.  You may always have debt. But, you need savings.  Saving will help you reach your goals and to deal with unexpected expenses and emergencies. Saving while paying back debt can help keep you from taking on more debt.  Specifically, you will have something to fall back on in an emergency.