Bookmark & Share:             
First Liberty Bank Newsletter
June 2017
Home


Home Page
Personal Banking
Business Banking
Contact Us
Rates
Financial Resources
Hours & Locations
Privacy Policy
  Subscribe to our Newsletter  
 
Tell A Friend
 
Facebook linkedin Twitter
 

Why You Should Treat Your Savings like a Bill
How it helps to budget for your savings

The ‘pay-yourself-first’ strategy is a popular tactic for personal saving; but there is a similar way to describe this same school of thought that is even more effective: Treating your savings like a bill.

A myriad of personal finance experts, bloggers and real-life success stories have come forward to vouch for this method of savings.

"When you create your monthly budget, add your savings and investments as a line item and pay them along with your regular bills," advise award-winning personal finance bloggers Holly and Greg Johnson in an MSN Money article via GOBankingRates.com. "This strategy allows you to 'pay yourself first' while also encouraging the idea that your personal savings should be a priority right up there with your mortgage."

Priorities, by principle, are not often ignored, says Brian Fourman, another award-winning blogger.

"So many things vie for our hard-earned dollars that it's easy to neglect setting something aside for savings," Fourman said to GOBankingRates. "In our monthly budget, my wife and I classify savings as an expense. We put it at the top of the expense categories so it's the first thing we see, thus becoming the first thing we end up doing with our paychecks."

When paying bills, many people opt to utilize online auto-pay functions, another method to consider when treating savings like a bill. Nancy Mann Jackson, editor of Bankrate.com, advises setting up an automatic monthly transfer, just as you would with the electric bill or fitness club membership, to ensure the money is saved each month and creating an air of forced savings via the bill pay-like transaction. According to award-winning personal finance author Valerie Rind, you can even take the “pay yourself first” notion to the next level by automating your paychecks and direct depositing your specified savings amount right into the savings account.

Finally, once you pay a bill, that money is never coming back; it can never be used again for any other expense. Your savings account funds should have that same lack of liquidity.

“Putting money in your savings account first can help get your psychology working in favor of saving over spending. If you direct deposit to savings and then have your bank transfer a lower allowance to your checking account to spend, your brain works hard to not touch that savings, said Joe Saul-Sehy, creator of StackingBenjamins.com and winner of the Best Personal Finance Podcast.

So whether you subscribe to the notion of paying yourself first or treating your savings like a bill, one thing is for certain: when done dutifully, your nest egg or emergency fund will be filling up fast.


[PRINTER FRIENDLY VERSION]

Published by First Liberty Bank
Includes copyrighted material of IMakeNews, Inc. and its suppliers.
TELL A FRIEND
Disclaimer - All content contained in this newsletter is for informational purposes only and should not be relied upon to make any financial, accounting, tax, legal or other related decisions. Each person must consider his or her objectives, risk tolerances and level of comfort when making financial decisions and should consult a competent professional advisor prior to making any such decisions. Any opinions expressed through the content in this newsletter are the opinions of the particular author only.

External links are provided for your convenience. The Bank does not endorse or guarantee the products, information, or recommendations provided by linked sites and the Bank is not liable for any products or services advertised on these sites. Each external site may have a privacy policy that differs from the Bank. Any linked site may provide less security than the Bank’s website and e-newsletter site.
ARCHIVE
May 2017
April 2017
March 2017

[MORE]



Powered by IMN