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By Lois Sullivan
Spending and saving money might seem like opposing forces in your mind, but when managed properly, they can serve as complements to one another. If you're looking for ways to improve your saving habits, your checking account might be the first place to start. Financial institutions offer a range of features and options to customers, and some can help you increase your savings. Take a closer look at seven ways to save money with a new checking account.
Before opening a new checking account, it's wise to compare the available options. Banks and credit unions can offer clients different features and account types at other times, and some are only available to current customers to reward their loyalty. Check with your current financial institution to see what's available, but don't stop there. Perform research to determine which banks offer the best interest rates, features, and tools to help you manage your money more effectively.
Some banks can offer high-yield accounts, while others provide accounts with rewards available to customers. Reward options that may be available include cash back on purchases or points that you can spend on travel, gift cards and other items. It's always worthwhile to figure out what a financial institution can offer so you can make the most of storing your money within one of its accounts, especially when trying to save money with a newly opened checking account.
If you decide on a new checking account that offers cash back or higher interest yields, these rewards can become tools for saving. Instead of spending the money you receive, make a point to transfer it into your savings account. Keeping the funds in your checking account can tempt you to spend the money, but moving the money to a separate account puts it out of your sight. Use any cash back you receive as a tool for saving. You can build up your account for the future without making significant changes to your spending or lifestyle habits.
When you open a new checking account, you may want to start using your brand-new debit card to make purchases. But a new checking account can be an ideal opportunity to start fresh with your finances. Use this time to set up a budget. Budgeting your money and adhering to spending limits are crucial to establishing good saving habits. If you're spending everything you earn each month, you won't have money left to save.
Setting up a budget can feel overwhelming, especially if you've never created one before. Start by taking a few months of bank statements and credit card bills to set a spending baseline. Create categories and determine how much you can afford to spend from each account. When you create your budget, you can start tracking your spending and make adjustments when you're out of money in a particular category.
Tracking your finances can be a lot of work; if you're feeling overwhelmed, you might put it on the back burner. But tracking is the best way to verify how much you're spending and saving. Try automating the processes to alleviate this burden. If you can swing it, set up automatic transfers from your checking account to your savings account to ensure you save something each month.
You can also take advantage of online budgeting and tracking tools that pull transactions from your bank account and credit card and categorize them. By simplifying how you manage your money, you can improve your chances of remaining vigilant about saving and spending.
If you're competitive, undergoing a challenge might be a fun way to build up your checking account. You can challenge yourself to reduce spending in specific ways and reward yourself when you achieve your goal. For example, if you're in the habit of eating out, you could transfer $10 to your savings account every time you eat a meal at home instead. Watching your checking account grow can motivate you to stick with your new money-saving habits.
If you have friends or family members trying to save money, consider creating a challenge with them. Encourage participants to identify a few ways they could cut back, along with a savings goal. Examples include increasing an account by a specific dollar amount or percentage.
If your bank account balance dips below zero, you may be subject to an overdraft fee from your financial institution. Although paying a fee once or twice won't dramatically affect your savings account, the fees do add up over time. When you create a new checking account, make sure to ask about low-balance alerts. If the financial institution offers this option, it's worth setting up an alert for when your account drops below a certain minimum amount.
You never have to pay a wasteful overdraft fee again by getting an instant notification when your balance is low. You can quickly log into your account and transfer money to cover any scheduled debits, a proactive way to begin saving money with a new checking account.
If you've ever missed a payment, you know that the penalties and fines for this mistake can be expensive. But when you're busy, it's easy to miss deadlines by mistake. Digital bills have also impacted on-time payments since customers don't always have a physical reminder of when a payment is due. Instead of taking the risk or trying to manage multiple due dates for payments on your own, use the tools built into your new checking account to set up automatic payments.
Online bill pay is available with most checking accounts, and it's an easy and convenient way to ensure you don't miss another payment and get hit with another fine. Start by collecting all the recurring bills you pay and logging into your bank account. You can set up each as a payment recipient in your account and then indicate how much to pay each regularly. By establishing automatic payments, you can ensure that you don't miss another due date.
By implementing these tips, you can build up your savings account and prepare for the future. Saving money is an excellent habit to establish in your life, as it will serve you through all stages and phases. If you're looking for a high-yield checking account to help you save, discover the options available through Alliant Credit Union. We also offer checking accounts for kids and teens who want to learn about good spending and saving habits.
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