HOW TO SAVE FOR MAJOR LIFE EVENTS: WEDDINGS, HOMES AND MORE

Saving is an important skill that typically plays a role in our lives at pivotal moments. Paying for college, affording your dream wedding, buying a home and even planning for retirement all revolve around saving money.

Check Out: 9 Easiest Ways To Maximize Your Savings in 2024

It doesn’t have to be stressful or unpleasant. Keep reading for a look at how you can save for these key milestones without feeling overwhelmed — and make the most of your money at the same time.

Also see five frugal habits to save money every day.

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General Tips To Save For Major Life Events

These are ideas you can apply to savings in general, but once mastered, they can be especially effective in helping you plan for major achievements.

Look for high-yield savings options: Maximize your savings by keeping them in the highest interest rate account you can find.
Create clear, actionable and realistic goals: No matter what you’re saving for, setting goals you have no chance of meeting won’t do much more than demoralize you. Think about how much money you make, how much you spend and how much you can expect to save each week.
Use personal finance management tools: Whether it’s a calculator and notepad, a spreadsheet, or something you might have available through an app or online banking site, use the financial management tools you have at your disposal.
Schedule check-ins and reviews along a timeline: Establish a reasonable timeline for your savings goals and determine dates when reviewing your progress would make sense.
Keep your eyes on the target: There will be plenty of reasons you might be tempted to dip into your savings at various points. Fight the urge. Always put money in your savings accounts with the idea that it will stay there until paying for a planned expense.

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Saving For Higher Education

Whether you are saving for your own higher education or putting money toward a child’s college fund, the cost of education can be one of life’s most significant responsibilities.

So when should you start saving? Early. If for your own education, right now. For a child, the sooner, the better, preferably when — or before — your child is born.

And here are some specific tips to help you save for higher education.

Some great education-specific savings plans, like 529 plans, can reduce or eliminate taxes that might otherwise apply to savings accounts.
Consider any grants or scholarships that can reduce the financial burden, and look into financial aid packages that might be available.
Determine how much you’ll likely need for tuition and all related expenses. This might change over time, so carefully review your goal at regular intervals.
Consider the best way to use any unexpected windfall profits. Annual bonuses, tax returns or even monetary gifts might be best used by putting them directly into your savings account.

Saving For a Wedding

Depending on your definition of a dream wedding, this can be one of the biggest single-event expenditures in your life.

So when should you start saving? As soon as both parties say yes, you have a date set, or plan to marry within the next year or two. This can be an intensive savings goal because of the relatively short time frame, so keep that in mind.

And here are some specific tips on how to save for a wedding.

There’s no better way to start a partnership than learning to talk about money, so set a budget together and come up with the maximum amount you both feel enthusiastic about spending.
As you would for any other goal-specific savings fund, open a dedicated savings account just for your wedding. Keep these funds separate from other savings, and don’t use them to pay for anything not wedding related.
You’ve got the advantage of picking a date for your wedding, so consider off-peak dates or seasons when you can get everything from the venue to the catering at bargain prices.

Saving For a Home

While weddings may be the single biggest one-event expenditure, buying a home is usually the single biggest investment anyone makes.

When should you start saving? This is a big question and relies on your circumstances, like how much you earn and the kind of home you hope to buy. Again, be realistic and reasonable, and determine how much you could comfortably save each month.

You’re in a pretty good spot if you can hit your savings target within three to five years. If it might take you significantly longer, you might need to think about a home you’d be happy in rather than one that ticks every box on your list.

And here are some specific tips on how to save for a home.

First, know how much you’ll realistically need to save. This means accounting for all the costs of purchasing a home, including closing costs, real estate agent fees, property taxes, homeowners insurance and maintenance.
Shoot for 20% of the home’s total price, as this will reduce the amount of principal you’ll have to pay down and eliminate the need for private mortgage insurance, which can be costly.
Start a separate account for your home fund. This can both help keep you motivated and provide a clear look at how well you’re meeting your savings goals.

Saving For Retirement

No matter how young you are, it’s never too early to think about retirement savings. This is a long-haul game, and you want to make sure you’ve got the best strategy to enjoy your golden years without stress or worry.

When should you start saving? Ideally, from your first paycheck onward. While most of us will miss this goal, the next best thing is to start saving right now.

And how can you save?

Most employers offer a 401(k). Contribute to it and take advantage of employer matching funds if that’s an available option. Roth IRAs are another great way to save for retirement and present significant advantages over other types of savings accounts.

Set up automatic payroll deductions with your employer or bank to deposit a percentage of each check directly into your retirement account.

If you’re investing for retirement, pay close attention to your risk tolerance and invest in different sectors or funds to reduce your risk of low returns. This is one area where seeking the advice of a financial professional can be especially important.

If you get a raise or bonus, add that to your retirement savings. While it might be tempting to use that money to splurge, few people regret saving too much money when they’re young.

Stay on top of your progress. Check your retirement accounts regularly to make sure you’re hitting the goals you’ve set, and if not, determine how to adjust to get on track.

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This article originally appeared on GOBankingRates.com: How To Save For Major Life Events: Weddings, Homes and More

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