Building a robust financial foundation can sometimes feel like an uphill task. It’s so easy to get swept up in the busyness of life and forget about the long-term goals and dreams we have for ourselves or our family. We often can’t see beyond the bills and expenses of today, let alone think about the later years when we won’t have the same income or health. Yet all it takes is a bit of time and planning to achieve those goals.
One way to do that is to use the Save feature o the Milestone App. This will help your child setup, meet their savings goals and keep track of contributions. Here are a few tips to plan and execute your savings goals (for yourself, or even together with your little one) so it’s easier to put your money to work for you.
To achieve any goal, start by defining it. No matter how big or small, goal setting motivates us and functions as a handy reminder to keep on top of it. Whether it’s a wedding you’re planning for, starting a university fund for your child, or saving for an investment property, it’s important to decide specifically what you’re working towards rather than navigating it without a clear number or goal in mind, or with the mindset of “save everything”. By defining your financial goals, you’re forced to have an honest conversation with yourself (and your loved ones) about money, what it means to you, and what you hope it accomplishes.
The human mindset is particularly persuasive when on deadline, so use this sense of urgency to reinforce a savings habit, at any age. To take the emotional or mental pressure off it, set a deadline and put a savings schedule in motion. For instance, if you want to set aside $50,000 in 5 years, that’s $10,000 a year, $833 a month or $27.70 per day. When goals are broken down into achievable chunks, you are automatically setting yourself up for success.
Putting all your money into 1-2 accounts can seem simpler to manage, especially admin-wise but you may be missing out on taking advantage of higher interest rates or bank promotions, and more importantly, could end up mixing different financial goals. As you’re likely to be saving for more than one goal (emergency fund, car payments, house renovations, retirement), clarify the process by having different accounts so there is no disputing what the money in the account can be used for. Also, if you need to prioritise some goals over others (extra tuition classes, health insurance) you can adjust the amounts accordingly.
Positive reinforcement is a wonderful way to keep focused on building a successful savings habit. Keeping track of your progress is a feedback loop that reminds you of your goals and the progress you’re making, and acts like a little dopamine hit to keep you motivated. And once you reach your goal, you’ll feel almost addicted to working towards other goals.
One way to do that is to teach your child to set up a savings goal with Milestone’s app use the Save feature on the Milestone app. This will help your child set up, meet their savings goals and keep track of contributions.
Out of sight, out of mind. Just as you don’t notice your CPF funds building up over the years, similarly, if your child automates a contribution via Milestone’s SAVE feature this helps him/her take the effort out of having to remember to do it and will keep him/her on top of their savings goals.