I am excited to be a contributor in The Budget Mama’s 21 Days to a Better Budget series.

Yesterday I shared Why You Should Automate Your Savings Plan

Why You Should Automate Your Savings Plan

It seems bold to say that making savings automatic can save you thousands of dollars, but it most definitely can. Here is my experience from two loans we paid off.

We had a student loan with a monthly payment of approximately $85. This was withdrawn automatically from our checking account every month. We decided to pay off the student loan with a portion of our savings and had every intention to put the monthly $85 into a savings account for our daughters’ schooling. We paid off the loan…and did nothing else.

That was 3 years ago. Because we didn’t immediately set up an account for saving the $85 we ended up spending the money each month. We missed out on over $3,000 in our daughters’ education savings accounts! By skipping the simple step of making it automatic, we ended up spending the $85 each month instead of saving it.

A year ago, we paid off a second student loan. We didn’t make the same mistake again. We paid off the loan and immediately set up a monthly recurring transfer to the Education Savings account we set up. Within a year, we now have an additional $1,380 in the account because we set up the automatic payment.

The Capital One 360 account currently offers a $25 Bonus on new accounts.

Make the decision to save, but then go the next step and make it automatic. If the payment is not automatic, it’s much easier to think: This month is tight, I will save next month.

Read the rest of the post here

Check out the Automatic Savings Resource Page for a free Automatic Savings Worksheet.

Automatic Savings Worksheet

 

Automate Your Savings Plan with Free Printable Worksheet

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15 comments on “Automate Your Savings Plan”

  1. Very good advice! I’m a big fan of automatic transfers into savings. We’re at a point, though, where I am on maternity leave, and we just moved to a new city. So we’re paying rent AND still paying a mortgage until our old place sells. It’s a very stressful time for us, financially. I did, however, make sure that I made a big contribution to my new son’s education fund. My point is, we are not in a position to be saving a lot of money right now, but before this point we were and we DID. And that will carry us through until our old house sells and we can start putting large amounts of money into savings again. I’m living proof that if you set money aside while you can, it will help you immensely in the long run.

    • Thank you for sharing, Monica. It must be stressful to be paying rent and a mortgage at the same time. Great job putting the money aside! It’s great that you made saving a priority when you did.

  2. I’m such a fan of automatic payments. Although it can be a hassle to get it set up, once it’s done, it’s done. I still have a few areas where this needs to happen, but this is so encouraging. Thank you for sharing!! #SHINEbloghop

  3. I love this advice. I have an automatic transfer from the account I get paid into to a savings account on payday, and it’s really neat to see that money grow! I think I’ll have to think a bit harder about my budget, and try out some of your tips!

  4. Automatic savings takes the negotiation out of saving and pays off in big dividends as we watch our money grow. It’s a win/win method. Thanks for sharing your story.

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