America Saves Week begins on Monday, February 26, 2018. This event is the product of the America Savings Educational Council and is strongly supported by all financial institutions in the state of Iowa. This program seeks to motivate, encourage and support households, as well as individuals to save money and build wealth. It is built on some very simple concepts:
- Save with a plan
- Save as a family
- Always “pay yourself first” and save regularly
- Save for rainy days
Having a road map to a goal is always the best way to start. Thinking about expenses, spending, and using all resources effectively is the basis for establishing a plan. Most of the time, a good savings plan is simply a matter of matching our finances with our costs or living within our means. Impulse spending is the source of all disaster, as well as using debt to cover living expenses.
Executing a savings plan is always easier if not done alone. Integrating family members from the youngest child to grandparents is a good way to stay on track and teach good habits. As a new grandfather, I am well aware of helping out my children save for the future of their families. Grandparents can provide funds on birthdays and at holidays instead of spending on the latest gadget or toy. There are many vehicles to do this. One of the best ways is a “529” education savings plan or a Treasury Direct account.
The concept of “paying yourself first” is a good way to provide accountability and discipline. Whatever amount you need to support your savings plan should be subtracted from any earnings or funds received and put into a savings account at your local, commercial bank. This is a safe place with no exposure to market price movements. Decisions about further investments can be made at a later time.
A crucial part of the plan is to save for emergencies. The best time to repair a hole in the roof is when it is not raining. The best time to accumulate funds for insurance against the unknown is now. The amount should simply be a multiple of monthly expenses and should be segregated in a liquid bank account that will not be touched. This allows the household or individual to absorb unplanned events and not have to go into debt. Once again, a savings account at your local, community bank is the place for this money because you can access it and it is insured against loss.
Iowa State Bank and Trust Company as your locally owned, community bank is committed to helping you in your savings plan. Let us all do this during America Saves Week!