How to save money

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Updated: 7/31/2013 12:51 pm
Saving money is an important habit to develop. Not only do you need to set aside money for retirement, but it's also wise to have extra funds on hand to cover unexpected expenses. Many financial advisers recommend saving 10 percent of your income, but if you can't afford that much just yet, contribute what you can. Saving just $25 (twenty-five dollars) a week will add up to $1,200 (12 hundred dollars) over a year's time. For convenience and consistency, consider having your bank automatically deduct a certain amount from your paycheck each month and put it directly into a savings account. After all, you can't spend what you don't see. The money you save should also work hard for you. Shop around to find the highest interest rates possible on CDs, Treasury bills, and other investments. At work, ask if your employer offers a 401K (4-oh-one-k) plan, a type of tax-deferred savings account. Most companies will match a percentage of your contribution, up to a particular dollar amount per year. Or, consider setting up an Investment Retirement Account, or IRA (I-R-A), another plan where your money can grow tax-free for a number of years.

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