When you have multiple financial goals, you might struggle to juggle them all. Should you start by saving for your emergency fund? What about that vacation you’re planning? Can you really prepare for the holidays ahead of time for once? We have a solution for you. Saving for multiple goals is doable and easier with the right tools.
Follow these steps to evaluate, prioritize and, ultimately, save for your goals.
Step 1: Determine your goals and set your deadlines
Start by identifying what you want to save for — maybe a new handbag, event tickets or a house. Make sure your list includes things you need or want, as well as the unexpected and less desirable, like a medical procedure or car repair.
After you identify savings goals, set target dates for each. This will help you figure out how much you should be saving on a regular basis to meet your goals on time. With the savings buckets tool in an Ally Bank Savings Account, you can specify a target amount and date for each goal to keep you on track.
Read more: Try these visualization tips to help you pursue your savings goals.
Step 2: Calculate how much you can save
Now it’s time to see how much money you’ll realistically be able to put toward your goals. Compare your monthly expenses against your monthly income. How much do you have left over? This is the amount you can put toward savings.
If you don’t already have a budget in place, try the 50/30/20 plan. With this method, 50% of your income goes to your needs, 30% goes to your wants and 20% is put toward your savings and any debt you have.
In order to budget easily, you can use spending buckets in an Ally Bank Spending Account, our checking account for modern money management. Buckets help you stay organized around your regular expenses and make it easier to track and set your budget. Hoping to save even more? When you link your checking account to your Ally Bank Savings Account, our Surprise Savings tool analyzes your transactions and automatically transfers any safe-to-save money directly into your savings.
Read more: 8 ways an Ally Bank Spending Account can simplify your finances.
Step 3: Prioritize, prioritize, prioritize
Equally dividing your monthly savings among all your goals may seem like the easiest method, but it might not the best idea. Instead, look at your savings goals and choose your top three: one in the near future, one a few years down the road and one long-term. While you might have more goals than this, sticking to just a few while you’re getting organized makes it easier to keep track and save up.
Step 4: Be savvy about where you stash it
Based on what you’re saving for, you may want to use different types of accounts. When determining where to put your money, consider interest rates, risk and liquidity. For your short-term savings goals and your emergency fund, it’s helpful to keep your money in an account where it’s easily accessible, like an Ally Bank Savings Account. Another account to consider is an Ally Bank Money Market Account, which is a flexible option for meeting short- and long-term goals.
Certain long-term goals, such as college or retirement, may be better suited for an investment account, depending on your timeline and risk tolerance.
Step 5: Make it easier with automation
Once you start saving, keep your momentum going. Ally Bank Savings Accounts include a host of automation tools, including recurring transfers and automatic roundups, so you can save even when you’re not thinking about it. Linking your spending and savings accounts makes it even easier to stay smart with the money you are earning now and your savings goals down the road. You’ll get a visual view of your regular transaction habits and find extra money hiding in plain sight to boost your savings.
Identifying financial goals with various timeframes and putting your savings on autopilot can set you up for the future. Once you have a plan for how you’ll reach your goals, anything is possible.
