Developing good savings habits early can help you create a financial cushion for emergencies and reach your long-term savings goals like buying a more reliable car or making a down payment for a house. In fact, even putting aside a small amount each month can quickly add up.
To help you visualize the benefits of saving, try out this handy calculator. Simply:
- Enter an amount you can afford to save each month
- Type in the estimated interest rate you expect to receive
- Plug in the number of years you plan to save
- Then just hit Calculate!
Be sure to post a comment about what you discovered, what you are savings for; or your own saving tips for other students right here on One For Your Money and get entered for a chance to win a $25 gift card*.
Keep in mind that most financial planners recommend setting aside at least 10 percent of your income to create an emergency fund equal to 3-6 months of your living expenses. This may be difficult for most college students, but here are some suggestions:
- Plan to set aside a small amount from each paycheck, even if it’s just $10.
- Try saving an amount equal to what you usually spend on things that you don’t really need such as coffee or fast food.
- Track your expenses for 1-2 weeks to identify specific expenses you can cut back on.
- Get started on a budget for next semester, including a plan for how you might not have to borrow as much for school.
So start saving now and pave the way to a bright financial future!