Our pick for a high-yield savings account: American Express® High Yield Savings
- Monthly fees: $0
- Interest compounded daily
- Minimum deposit to open: $0
Finder is committed to editorial independence. While we receive compensation when you click links to partners, they do not influence our content.
Despite your best efforts and intentions, sometimes bills pile up, emergencies happen and it can feel impossible to save enough to make a difference. Thankfully, with some tweaks to your finances and the help of a few tools, building up your savings doesn’t need to be painful. Here’s how to save money in eight steps.
Whether it’s an emergency fund, a summer backpacking across Europe or a down payment on a house, you probably have an idea of the financial goals you want to achieve. Write down all those goals — both small and large — and estimate how much you need to save to reach them.
Once you’ve arrived at a lump sum, determine how long it will take to save that amount depending on your income. For example, if you plan to save $10,000 to take a vacation within the next two years, then you should save about $416 per month. This amount could be a bit less, thanks to compound interest, but it’s better to run a bit over than a bit under.
Learning how to budget and stick to it is one of the best things you can do for your finances. Not only does it help you figure out how much you can set aside in your savings account each month, but it’ll help make sure you don’t end up with overdue bills that hurt your credit and turn into debt.
Follow these steps to start your own budget.
If you have any money left over, congrats! You’re spending less than you earn. Use the excess money to fund your savings goals. If you’re over budget, this next step may come in handy.
Want to automate this process? Use a budgeting app to calculate, track and manage your expenses.
When it comes to saving, every little bit counts. Even if you only shave off an extra $50 a month from your spending, that’s $600 more you have a year to put toward your goals.
With that in mind, review your expenses to see if there are any you can live without. You don’t have to give up that $5 latte if it makes you happy, but your budget may be riddled with other purchases you don’t use or enjoy. For example, do you have any gym memberships, monthly subscription boxes, or a Hulu or Disney+ subscription you hardly ever use? Even necessary costs, like groceries, can be tightened up a bit by switching brands or watching for sales.
To get the maximum annual percentage yield (APY), you need to set up the right account. There are several types of savings accounts, but the two main options are:
|Type of account||Best for||Features|
|Traditional savings accounts|
|Online savings accounts|
Once you’ve decided which savings account type is right for you, it’s time to compare your options and choose one. If you’re looking for a high-yield savings account with zero fees, look at online savings accounts as opposed to ones at traditional brick-and-mortar banks. Online and digital banks tend to be more competitive than traditional banks because they don’t have to deal with the costs of keeping branches open.
Reach your goals even faster by putting your savings on autopilot. Most banks let you set up recurring deposits from your checking to your savings account each month. That way your money is out of sight, out of mind. There are also money saving apps that will automatically round up your spare change and move money into savings for you. Automated tools like Digit will even analyze your bank accounts and move extra money to savings when you can afford it.
A savings plan is the process of nailing down exactly how you’ll save enough money to reach your goals. Here are some common plans you can use to boost your savings.
Checking in on your savings progress has several benefits — you’ll can spot any suspicious charges on your bank accounts, you’ll know if you’re on track to meet your goal or if you need to adjust, you’ll get a confidence boost from seeing how much you’ve saved and you may come across new ways to save like:
Many of us start out with plenty of ambition and the best of intentions, but within a couple of weeks our carefully crafted savings plan has fallen by the wayside. However, there are a few key things you can do to ensure that you stick to your plan.
Decide on a portion of earnings that you’d like to manually deposit into a savings account each month — and make sure you stick with it.
You can plan to retire. You can plan for tax season. You can even plan for death — but you can’t plan for everything. You can, however, take steps to prepare yourself for the unexpected so you don’t get permanently knocked down when you hit an obstacle. A few ways to do that are to:
Saving can be difficult, especially when you think about how much it costs to make a big purchase or even retire. However, taking small steps to stash money away in a savings account every month can start to add up to major savings after a few years. If you make smart financial decisions and turn budgeting and saving into a habit, future you will be grateful.
HMBradley is a hybrid checking and savings account that earns up to 3.0% APY.
Zeta Joint Cards allow two people to share one account, but there are several drawbacks.
Here’s a breakdown of Wells Fargo’s common account fees and how to avoid them.
Compare the five best bank accounts for self-employed professionals and freelancers.
Unifimoney lets you spend, save and invest, but it’s only free for high-income individuals.
A retirement plan for self-employed individuals but may come with high administrative fees.
A stock’s price-to-earnings ratio can help you decide whether to include it in your portfolio.
These pesky fees can eat into your bottom line: here’s how to identify them.
Trade multiple options strategies with this popular free app for basic and advanced traders — including 6 steps to get started with options.
Features and fees to consider before you open a Schwab Intelligent Portfolios account.
finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which finder.com receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. finder.com compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.