Savings plan tips

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Having a savings plan is the responsible thing at any time, but in a tight economy, it's a must. Seeing your balance increase every month will give you a sense of security and accomplishment. Make a plan, and start today

Emergency savings

You must save enough to be prepared for the unexpected. Your goal is to have enough living expenses saved to see you and your family through at least six months. Take into account your mortgage/rent, car payments, insurance, utilities, groceries and other regular monthly expenses. If it seems like a scary number, don't panic: You have to start somewhere, and knowing what you'll need to cover basic costs is the first step.

By saving a little each week, you'll begin to build your emergency fund. You can forego small luxuries to get started... for example, don't eat fast food for a week, or give up your regular dvd rentals. In the larger scheme of things, knowing you have a safety net if you're unable to work for some reason will be worth it.

Short-term savings

Short-term savings are monies designated for things you will need within the next year -- for example, a new car, new couch, new appliances, Christmas gifts or even your next vacation. By planning ahead and saving, you won't have to use credit cards for these types of purchases and will avoid paying interest on the bills.

Long-term savings

The future is approaching fast if you have children who will need a college education, or if you're hoping to purchase your own home. Long-term savingsa are for items that are several years away. If you also aren't yet saving for your retirement, look first to see if your company has a 401K plan that matches your contributions. If so, max out the amount you save to get the company's highest allowable matching funds. It's like getting an immediate raise.

You may want to establish separate savings accounts for emergencies and short- and long-term savings -- or keep all the funds in a single account. Whatever you decide, begin contributing immediately and regularly to your savings plan. Decide how much you can save -- weekly or monthly -- and pay yourself first.

Vicki Clinebell majored in journalism at the University of Colorado, and headed an advertising agency before beginning a long career in broadcasting, spanning production and copywriting to sales and management for an ABC affiliate station. Deciding to switch gears and write fulfilled a lifelong ambition. She started as a blogger for a diverse group of businesses, and now writes for a number of websites for companies in her hometown in the Rocky Mountains, and provides advertising copy and media buying for national and regional clients. She finds the research as interesting as the writing, learning about subjects as diverse as construction scaffolding, child safety seats, and newest trends in beauty and fashion. As a long-time devotee of SheKnows, she’s thrilled to see her own work on the pages.