5 Reasons You Need an Automatic Savings Plan

If you want to get a better handle on your money, you probably need a savings plan. The challenge then becomes: how do you start saving?

Sometimes it’s tough to get motivated. Luckily, there’s an easy solution: an automatic savings plan. Using an automatic savings plan, you can put money aside effortlessly, and without thinking about it.

To get going, all you have to do is sign up for an automatic transfer of money from your checking to your savings account. Having a personal savings plan that is automatic can help you finally save money. For more inspiration, here are 5 reasons you need an automatic savings plan.

1. You need to pay yourself first

One of the cardinal rules of personal finance is “pay yourself first”. You may already know that this is something you should do. But, it feels like your bills eat up your money before you have time to save.

When you have an automatic savings plan, however, you actually put “paying yourself first” into action. You do this by saving money through recurring transfers that are automatic. Once you’ve made these transfers, you can use your leftover money to pay your bills and spend in other ways. Look at it this way: instead of paying your bills first and then trying to save what’s left, you’re reversing the order. To help you get going, money savings apps like Digit, Qapital, and Chime will help you automate your savings.

2. You’ll stop making excuses

“I can’t afford to save!” “Saving is too hard!” “What’s the point of saving? YOLO!”

Any of these sound familiar? If so, you’re pretty good at making excuses for why you can’t save. And it’s okay. We all do it. The brain is a powerful rationalizing machine. Our mind and our thoughts affect our behavior. So, if you’re making excuses for why you can’t save, you probably aren’t saving.

An automatic savings plan helps you combat these excuses and save money – no matter what.

3. You can set it and forget it

Saving is often difficult because it turns into just one more thing you have to do. Perhaps you say, “I’ll get to it later” and then life becomes busy and you don’t get around to it.

Yet, when you have an automatic savings plan, you can effortlessly save. Basically, a savings plan allows you to set it and forget it. You can rest assured that you are putting money aside each month and boosting your financial wellness.

Saving money is a part of proper adulting, but it doesn’t have to be difficult. Committing to save even one percent of your salary each month through an automatic savings plan can help you build a cushion. You can even save spare change through money savings apps like Acorns and Chime.

4. You can avoid disaster…while saving for your dreams, too

Do you know the difference between a crisis and an inconvenience? Money.

Let’s say you lose your job or your car breaks down. If you have no cash set aside, these things can turn into major crises. You can’t live without a paycheck and you need a reliable car to get to work. If you have money saved up for emergencies, however, you can pay for the problem and deal with it.

Having money in savings isn’t just helpful for dealing with the inevitable emergencies that pop up in life, but savings can also help you pursue your dreams. Want to go on a once in a lifetime trip to Southeast Asia? Want to buy a new Tesla? A personal savings plan can help you achieve these goals.

5. You can avoid procrastination  

If you haven’t started saving, you might think it’s too late to start now. But procrastinating won’t help you! There’s a saying that goes: “The best time to plant a tree was 20 years ago. The second best time is now.”

It’s never too late to get started no matter how old you are and no matter how much you can save. Through an automatic savings plan, you can beat the procrastination blues and take action today to create a savings plan that works.

Bottom line

We get it. Saving money can seem like a bore, a chore, or just one more thing to do. But it’s one of the best things you can do for yourself and your future.

When you create a personal savings plan, you’re actively investing in your financial wellness. So, why not set up a recurring transfer from your checking account to a separate savings account today? You can set the amount and the frequency of transfers. If you want to make it even easier, check out money saving apps and begin your path right now.

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