It is much easier and more enjoyable to take the income, the money we have earned and worked hard to receive, and spend all of it every month, purchase whatever we want and not think about the future. The future, for some people, is so far away that we think that it is not necessary to think about it. But in reality, there is no better time to think about it than now.

As a CNN Money article suggests, when it comes to money, we just aren't doing it enough. A majority of people in the U.S. are saving from nothing to 5% of their income when it is suggested you save 15% each month. Why? There are many reasons to save. 

Savings Goals

Between today and the conclusion of our income-earning days, a lot can and will happen. We might lose our job(s), take a pay increase or decrease, move or become disabled and unable to work. Strategizing about the income we make now to make plans for the future is one of the best things we can do with our hard-earned money.

The future doesn't just have to be retirement - the future is tomorrow. It is allowing a break from the paycheck-to-paycheck cycle or allowing for a big purchase down the road, like a vehicle, vacation or house. Living paycheck-to-paycheck cycle, surprisingly, isn't just something that happens to those earning lower incomes, but to anyone unable to create a budget and follow it, and to make savings goals and reach them. 

Saving for Retirement

Regardless of your age, if you are planning to retire at any time, it is important to save today, save consistently, and save wisely. Let's review another top 10 list, this one for retirement planning. There are many options to save for retirement and ways to do it, including your employer’s retirement savings plan or an IRA. Examining your needs through a retirement calculator is also helpful.

Once you realize the importance of saving and the role that it plays in your life, creating goals is the next step to stay on track. Part of setting financial goals is making sure you can meet them. You can use an online savings calculator, for example, to make sure your needs align with your plan. (See also: Top Retirement Savings Advice for Everyone.)

Specific Steps

Armed with the education and tools to create realistic goals for your money, it is time to find and dedicate the money to reach your goals. 

  1. The first thing you need to do is have a budget and stick to it. This includes being realistic about your household financial situation and setting honest and attainable numbers corresponding to your spending so that you can save. Saying you will save and thinking about savings is not enough. You will have to be intentional about what you do with your money.
  2. You need to understand cash flow; what it is, how it works and what your personal household cash flow looks like. Review your income and expenses and see where your spending habits lie. Be intentional about making changes to things you can, to have money available to save. 
  3. If you are married, communication and teamwork concerning your household finances are crucial. To save, you both need to be on board with your desires, plans, and resources. The best-laid plans without everyone on board will meet turmoil. 
  4. Understand the differences between needs and wants and identify yours. Be able to say no when something doesn't align with your financial goals, today and in the future. 
  5. Automate savings so the money goes and stays. If you wait until the end of the month to save, the likelihood will be that there is not much left to save. Make it automatic and save when you first get paid. If you have a few savings objectives, you can track the money you put into each account and put it through one account or use a few different savings accounts open for various goals. When you see savings and its growth, you are more likely to keep it there.
  6. Review everything you pay for. What are you paying for that you might not need? Is there a way to pay less? Sometimes we do not even realize what are spending each month until we examine it. 
  7. What expenses or items can you cut to enhance your savings goals? Bank rate gives 5 opportunities in your budget and spending to cut expenses, including energy and car gas, food and groceries, banking and credit, taxes and car insurance. All of these areas should be reviewed for opportunities. 
  8. Remember whatever your goal is, start now. Something will always come up and compete for your resources. Saving for the future should stay in the forefront of your mind (and your finances!) regardless of whatever else comes around.
  9. Also, take into consideration your children. It is incredibly important to teach them about savings and spending. They mirror your behaviors and will take your lead on the role of money in their lives. Some essential lessons, summarized in this Forbes article, include waiting to purchase something you want, saving, identifying specific ways for children to save such as using jars or envelopes, making wise choices and understanding that when money is spent, it can not be spent somewhere else.
  10. Recognize the importance of savings, but also enjoy life.

The Bottom Line

The above strategies will help you to stick to a budget and save for your goals all while allowing for some budgeted fun. Remember, a goal without a plan is just a wish. Write it down, create the time and opportunity and make it happen.