Each month we pick on concept to focus on in Young Americans Bank. During December, we realized that, with people spending lots of money on gifts for each other, it’s easy to forget to spend money yourself! That’s why we’re promoting” Pay Yourself First,” the best way to think about saving for the future.
What does “Pay Yourself First” mean?
- Once you deposit money into your savings account it is safer, and you’re less likely to spend it than if you keep it with you.
- When you save at a bank, your money earns interest—free money the bank gives you. The longer your money stays in the bank, the more interest you earn.
- When you Pay Yourself First, you always have a little extra money in the bank. This comes in handy for unexpected expenses, whether they are “rainy day” or emergency!
- Paying Yourself First helps you make a savings plan to reach your goals, whether they are long or short-term.
- When you deposit money into your savings right away, it becomes a habit, and you’ll remember to Pay Yourself First every time!
We recommend that you Pay Yourself First at least 10% of whatever you receive, though that amount can vary depending on what your other needs are at the time. Just be sure that you’re saving something so you can pay for big purchase in the future. For instance, if you’re saving for college, how much do you think you need? Use this sheet to take a look at some college tuition rates so you can decide how much you should be saving.
As always, be sure to come into Young Americans Bank for more resources and support from our staff about saving and budgeting!