As the current year comes to a close, now is the perfect time to review your personal finances and establish a more structured budget for the upcoming year. One effective strategy to consider is automating your savings. By setting up automatic transfers to your savings account, you can ensure you consistently set aside money for future needs. It's like putting your personal financial growth on autopilot!

This approach not only simplifies the savings process—allowing you to save without having to think about it—but also helps develop better financial habits. 

What is Automated Savings?

Automated savings, as the term suggests, is a smart financial strategy designed to help individuals effortlessly build their savings over time. This approach involves automatic transfers of funds into your savings account on a regular basis, either directly from your paycheck or through recurring transfers you can set up with your bank.

Once you set up your automated savings plan, you no longer need to worry about manually setting aside money. The funds are transferred each month with no additional effort on your part. This simplifies your budgeting process and encourages a disciplined savings habit, allowing you to watch your savings grow steadily over time.

How Much Money Should You Save?

Every person's financial situation is unique, so there is no one-size-fits-all amount that everyone should set aside through automated savings. To figure out how much you should set aside each month, you need to assess your financial circumstances.

Look at your income (salary, bonuses, and any other sources of income), expenses (rent, utilities, groceries, transportation, and entertainment), and debt (credit cards, automobile loans, and student loans). Once you have this information, you can choose your savings rate.

Most financial experts agree that saving between 10% and 20% of your monthly take-home income is recommended. If you find that setting aside this percentage isn't feasible for your current situation, use our budget calculator to see what works for you. Remember: every little bit counts!

How To Automate Your Savings

Once you review your finances and decide on the amount of money you want to save regularly, you can set up your automated savings. This process is quick and straightforward. Start by logging into your bank's website or app and linking your personal checking account to your personal savings account. Once this step is complete, you can set up recurring transfers—weekly or monthly—from your checking account to your savings account.

Another option is to contact your company's payroll or human resources department to ask whether a portion of your paycheck can be deposited directly into your bank savings account. If you are self-employed and your income varies each month, consider setting up quarterly transfers to your savings account.

Avoid Dipping Into Your Savings Account

Once you set up an automated savings plan and watch your balance steadily increase, it's important to resist the temptation to withdraw money for unnecessary purchases. The sight of funds can be tempting; it might invite thoughts of splurging on a gift for yourself or a loved one, treating yourself to an extravagant dinner, or purchasing other non-essential items that catch your eye.

Always keep in mind that this growing fund will be needed in the future for emergencies, large purchases, or investments. So, stay disciplined and committed to your savings goal, as each dollar saved helps create a stable foundation for your future.

Covering the Cost of Emergencies

Emergencies can occur at any time, often catching us off guard and presenting unexpected challenges. These include illness, injury, car troubles, and damage to a home. These and other emergencies almost always require money, even if you have insurance coverage to help mitigate the costs. During these critical times, it is both reasonable and necessary to access your savings account or tap into your dedicated emergency fund.

Once you cover the costs associated with any unforeseen emergencies, it's important to reinstate your savings goals with automatic deposits.

Adjust The Amount You Save, If Needed

If your financial situation changes, consider revising the amount of money that is automatically transferred to your savings account. For example, if you receive a salary increase or land a new job with a higher pay rate, this boost in your income could provide you with additional funds to allocate towards your savings goals.

On the other hand, if you find yourself facing job loss, a reduction in your income, or unexpected debt, you may need to decrease the amount you save. It's important to stay attuned to these changes so that your savings strategy remains effective and on target.

Now that you better understand the myriad benefits of automated savings, it's time to get started. If you have a checking account and savings account with Ameris Bank and want to set up a recurring transfer, log in to your Ameris Bank online account and navigate to the "Transfer Funds" section. If you have questions or need personalized help getting started, contact us to speak with an Ameris Bank banker. 



The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.