To be successful with any goal, you need to make a plan. First, we recommend you meet with your financial planning team for professional advice. Beyond that, here are five steps you can take to help boost your savings and achieve your goals.
Review your budget
Before you set an investing goal, it’s important to be realistic about what you can save. Make an accurate listing of your total monthly income and expenses (including bills and living costs) to assess what you can reasonably commit to saving. If the result isn’t what you’re hoping for, this exercise can open your eyes to new opportunities for trimming your expenses or even other income opportunities.
Make your goal specific
Knowing you want to save more is one thing, but research shows you have a better chance of success if you have a specific goal in mind.1 If you’re saving for a vacation or other major purchase, for example, determine how much you need to put aside each month so that you save enough by your target date. For longer-term needs like retirement or a down payment on a home, set aside money each month as you works towards an annual savings goal.
Once you’ve determined how much to save, the next step is to make consistent contributions. There are many ways to do this, but the easiest is to set up a pre-authorized transfer. In conversation with your financial planning team or through online banking, you can set the amount and the frequency, and the funds will transfer to your savings or investing account on the days you choose. Automatic contributions can help you avoid thoughtless spending and stay on course. Take a look at this article: Harnessing the power of automatic contributions, from our award-winning partner, Qtrade Investor, to learn more about the benefits of automatic contributions.
Track your progress
One study suggests that tracking progress may be just as important as setting the goal in the first place.2 Check online banking or your statements monthly and celebrate the growth you see there. Not only is it motivating to see your progress towards accomplishing your goal, tracking also helps you make adjustments if your plan isn’t quite working.
Maximize your savings
Once you’ve built up some savings, consider putting your money to work. If you’ll need access to the money within a couple of years, you might want to play it safe: investments like GICs or high-interest savings accounts can help you earn interest without exposing you to market risk. For medium- and longer-term goals, you can seek higher returns by investing a portion of your savings in equities. You should speak to your financial planning team to help you make these types of decisions.
Following these easy steps can help you commit to your savings goals and improve your financial well-being. Once your plan is in place, you may be surprised at how quickly your habits change and your dollars add up.
1 Houston, Elaine. “What is goal setting and how to do it well.” www.positivepsychology.com. Nov 20, 2019.
2 Hirsch, Wendy. “Goal Monitoring: Why it pays to keep your eye on the prize.” www.scienceforwork.com. June 5, 2017.
Adapted from “Five easy steps to help you achieve your savings resolution,” published by Qtrade Investor.
Mutual funds, other securities and securities related financial planning services are offered through Qtrade Advisor, a division of Credential Qtrade Securities Inc. Mutual funds and related financial planning services are offered through Qtrade Asset Management (a tradename of Credential Asset Management Inc).
The information contained in this article was obtained from sources believed to be reliable; however, we cannot guarantee that it is accurate or complete. This article is provided as a general source of information and should not be considered personal investment advice or a solicitation to buy or sell any mutual funds and other securities