Savings Fundamentals

Saving is a lifelong journey, but that doesn't mean it has to be daunting. Even small amounts can add up over time. 

On this page:

4 essential savings tips

Consider these four essential savings tips, listed in order of suggested priority.

More Savings Goals

Consider these savings goals as well.

The first four savings fundamentals are essential for everyone. Once you've tackled those, consider these additional savings goals in any order. Pick and choose your goals according to your personal financial priorities.

  • Save for a child's education

    • Saving for retirement should still be your top priority, but it's possible to save for a child's education as well, particularly since there may be tax benefits. Any amount saved for education is less you may need to borrow.

    What you can do now:

  • Save for a down payment on a home

    • To estimate what you'll need for a down payment, get an idea of the purchase price and what type of monthly mortgage payments you can afford. The general rule of thumb is to spend no more than 28% of your gross income on principal, interest, property taxes, and insurance.

    What you can do now:

  • Pay down other debt

    • Once you've taken care of your other savings priorities, we recommend that you start paying down high-cost debt, even if it's deductible. Unless you can refinance at a lower rate, this includes tax-deductible debt such as mortgages, home equity lines of credit (HELOCs), and student loans.

    What you can do now:

  • Keep investing

    • To outpace inflation, your money needs to earn more than many traditional savings accounts pay. Our recommendation for long-term investors is to invest early and often—regardless of what's happening in the market.

    What you can do now:

    • Get more details on how to invest and why waiting to invest can be costly.

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