In 2021, the world will be a much different place. With all of the economic changes that have been happening as of late, it is hard to know what we can expect in just a few years from now. But one thing is for sure: saving money will become an art form again. Money management has always been something people should take seriously and with all of these new ways to make or lose money, this skill will become even more important. In order to help you prepare for your future financial needs, here are some tips on how to save money in 2021 with smart investing habits today!
First, make saving money a priority. If you can put saving money as something that is important to you, it will be easier to stick with your goals and see your saving grow over time. One way to do this is by setting up automatic transfers into different accounts that are specifically for saving, like a high yield online savings account or even an IRA (Individual Retirement Account). If you are in Canada, check out a TFSA account.
Now that saving has become second nature to you, it’s time to start thinking about smart investing. The Wall Street Journal recommends people in their 20s and 30s invest heavily in stocks now so they can reap the benefits later on. Stocks are great because there is always some sort of demand out there, meaning the value should only go up over time if the company is profitable.
As you get older, your savings needs may change. One great way to balance all of these saving goals is with an online brokerage account. A brokerage can help you save for retirement, save up for a home purchase, or even save money for your children’s future education costs. With so many possibilities available today, there are no excuses not to be saving in 2021!
Investing wisely in the Stock Market
The Wall Street Journal recommends saving in stocks as long as you’re not putting too much of your life savings into it. You should be saving roughly 12% of your income if you want to retire by age 60 and up to 15% if you want to retire by age 70. If those numbers don’t quite make sense, here is a breakdown:
– At the age of 30, saving 12% means saving $4,800 annually
– At the age of 40, saving 12% means saving $7,200 annually
– At the age of 50, saving 12% means saving $9,600 annually
These are just rough estimates so be sure to do your own research when planning for retirement! It’s always better to save early so you can take advantage of compound interest.
Being smart with your money doesn’t mean avoiding saving entirely. It just means being smart about where you put your saving dollars so you can have even more in the future!
In Canada, if you are interested in saving up for retirement and investing wisely, consider opening a TFSA account with Wealthsimple today. With their easy-to-use interface, this is a great option for beginners who want to start saving with the right tools.
To save for short-term goals that may be less than 5 years away, check out if your bank has a high yield online savings account available for you. If you are saving for a home purchase, an RDSP account is a great option as well.
Regardless of your saving needs, having multiple saving accounts is the best way to ensure that you will have enough money for whatever life throws at you! Try out a new saving account with Wealthsimple today and see how much money you can save by 2021.
Good investing habits in your twenties and thirties can help secure your retirement in your sixties or seventies—or even earlier if possible. Start now so you won’t have to work forever!
A Penny Saved is a Penny Earned
Savings are something that everyone should do. Whether saving for retirement, saving for a big purchase, or saving until you finally learn the words “Valar Morghulis”, saving is always important. But saving can be hard work. Money doesn’t just magically grow in your account without some planning and a healthy dose of patience and self-control. That’s why we’re going to help you in saving for the next ten years.
The Savings Plan
So, first things first. You need to open a savings account. You can research multiple banks and find which one is right for you. Some banks offer perks like saving accounts that give interest rate bonuses if you deposit your salary into them or saving accounts with debit cards attached where you are charged fewer fees when using ATMs of other banks. Loyalty pays off here because many times these companies also have higher interest rates. Make sure to make it easy on yourself by setting up an automatic transfer every month from your checking account to your saving account so you never even see the money sitting there taunting you. Call it to pay yourself first or call it reverse psychology, saving has never been so easy.
To go with the theme of saving for yourself in 2021, let’s talk about investing. Some people are natural investors and some aren’t even interested in investing at all. But if you’re reading this article, chances are that you want to invest your money in something more profitable than Tickle Me Elmo stock back in 1996. So, if you’re ready to enter the world of investments, check out Mutual Funds where you can put your money into stocks or bonds or other financial instruments that return a profit over time instead of losing half of your savings account when that meteor hits Earth again (it had wiped out 90% off investment portfolios back on March 6th). Also remember to read the fine print before you sign anything because it’s important to know what you’re getting yourself into.
Schedule for Success
One of the most important parts of saving money is having a routine or schedule for saving. Without one, saving money can turn into saving when you have leftover cash after spending everything else or saving when your parents come through with that trust fund they promised back when you were born. Start saving now by pre-scheduling transfers from your checking account to your saving account on a weekly, monthly and yearly basis: this way saving becomes a habit, and saving becomes second nature.
However, saving money for your future isn’t as easy as saving up all of those quarters from under the couch cushions throughout your childhood. Sometimes you need to know how to save up that extra cash you have lying around or saving until you can afford that huge purchase that has been saving up for itself since the day it was born. So let’s talk about some tips and tricks to help you save your hard-earned cash:
Saving Trick #1: Save where you spend
This means making saving part of your everyday life and spending habits by either transferring money out of checking accounts into savings before shopping or saving up each month before buying bigger items like TVs or cellphones. This way any saving you make for other purchases is hidden away until the time comes to buy something bigger. It’s like saving money, but without saving money.
Saving Trick #2: Just use cash
Dumb saving tip alert! But saving using only cash makes it harder to overspend or impulse buy because actual physical dollars need to be exchanged before you can start buying things with them. This also means no more hiding extra credit card bills in your saving account and having one less thing to pay at the end of the month. If you’re trying to save up for a big purchase this is a good option because it’s hard to see how much you’ve saved when everything gets paid together on one statement anyway.
Saving Trick #3: Make saving fun
The best saving tip is to turn saving into a game. The more you save, the better the reward you get at the end of saving up for whatever it is you’re saving up for. For example, when saving to buy that next-generation gaming console, just take away the money saved in your checking account or savings account and put it in an envelope or piggybank until enough has been saved. Then off you go to purchase whatever it was you were saving up for!
Be sure to have a plan for your future, and start saving now. You may not think that you need help with this now, but it is better to be proactive than reactive when the time comes. This guide should give you enough information on where to get started so that you can make your own informed decision about how much money you want in savings by retirement age. The more educated decisions we make today will lead us towards having an enjoyable life down the road – which means feeling confident knowing what our needs are over the next 50 years of our lives. Saving doesn’t have to be difficult or boring; there are plenty of ways out there if it makes sense for your lifestyle!