Four Simple Steps to Start Saving

Julie and her husband work full time and are solidly in the middle class. Their paychecks cover their bills and a few extras, and they consider themselves comfortable. But they would spiral into financial ruin if they had any unexpected large expenses, like a medical emergency. That’s because, like many Americans, they have zero money saved.

According to the 2017 GoBankingRates survey, 57 percent of Americans say they have less than $1,000 in savings—less than the 69 percent in the same situation in 2016. But the bad news is that while the number of Americans with less than $1,000 in savings is decreasing, the number of Americans with nothing in savings—like Julie’s family— grew from 34 percent in 2016 to 39 percent in 2017. So if you’re one emergency away from financial disaster, here are some simple steps to start saving:

Make a plan

You’re unlikely to begin saving unless you have a plan to start putting away money. First, figure out what your monthly expenses are and make a budget. Then you can figure out what’s extra and what you can save. Are you spending too much on entertainment or eating out? Consider cutting back to beef up your savings account. It’s a good idea to plan your savings as a line item in your budget, like your grocery expenses. Experts say you should save 20 percent of your income, which should be a combination of dedicated retirement and savings accounts. But that amount may seem daunting in the beginning. So start with what you can. Make a budget, then plan how you’re going to start—or increase—your savings.

Set up a separate account

An excellent way to keep yourself from spending your savings is to put the money in a separate account. And the best way to keep money accumulating in the account is to have an automatic deposit, either from your paycheck or checking account. Shop around to different banks to find the most convenient and highest-interest account available for you. Keep in mind that the best account option might be at an online-only bank that doesn’t have a brick-and-mortar presence. And having an automatic deposit into the savings account will keep the money flowing, without you having to think about it—and before you have a chance to spend it on something unnecessary. So find the best savings account for you, set it up, and start an automatic deposit into the account.

Find an app

If you have a smartphone or tablet computer, using an app is a convenient and straightforward way to track spending and saving. A quick search of Apple’s App Store will bring up quite a few options. Here are some of the best for budgeting, saving or both:

Acorns: This app does the saving for you. When you buy something with a card connected to the app, it rounds up the purchase to the next highest dollar and then invests the difference into a portfolio of exchange-traded funds selected by you, based on your risk preference. It’s like investing your spare change.

You Need a Budget: This app, which charges a monthly or annual fee, helps you balance your budget, and stick to it, so you stop living paycheck to paycheck. It also offers live classes to help users learn basic budget skills. The average user of this app pays off $500 in debt in the first month.

Mint: This free app helps users create a budget and track spending. It allows you to connect your credit card, bank accounts, and bills, so everything is in one convenient place. It reminds you when bills are due, how much you owe and what you can pay. It even gives users tips to have more control over their budget.

Wally: This app is excellent for anyone who’s serious about tracking spending. It allows users to take a photo of receipts to log all spending, so they don’t lose track of spending. With insight from the app, users can compare money in to money out, so they can better make and set spending and savings goals.

If you’re serious about saving and budgeting, there are a variety of apps on the market to help you achieve your goals.

Learn more about your finances

If you’re like most Americans, you could benefit from more financial knowledge. Sixty-three percent of Americans can’t pass a five-question quiz about financial literacy, according to a recent survey. But you can find help easily. has a test so you can see where you fall on the financial knowledge spectrum, and it has ways to help you improve. Also, you may be able to find in-person classes in your community. In Utah, Community Action Services and Food Bank has a free Financial Learning Center. It offers one-on-one coaching in budgeting, credit, debt management, and saving. And if you need help with another financial issue, it has a network of partners in the community to offer you ongoing advice or support. It’s not too late to gain control of your finances and saving, and there’s help available online or in person if you need it.

If you’re one emergency away from financial ruin, it’s time to take some simple steps toward saving. So make a plan, set up a separate account with an automatic deposit, get some assistance from an app, and learn more about your finances.

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