Sign up for your free Credit.com account    Sign Up Now
From the Experts at Credit.com

5 Habits of Successful Savers & Investors

Advertiser Disclosure by Lucy Lazarony

5 Habits of Successful Savers & Investors

Successful saving and investing takes time and persistence. To have the money in your budget each month for savings and investment goals takes an ongoing financial commitment.

If you’re learning how to make that financial commitment stick, consider these five habits of successful savers and investors.

1. They Set Aside Today’s Money for Future Goals

Successful savers and investors think ahead. They don’t just live for today and let tomorrow sort itself out. They put financial capital toward savings and investing goals that are important to them — retirement, paying for a child’s education, etc.

2. They Stick to Their Goals

A key to successful saving and investing is consistency. They stick to their savings and investing goals month after month and year after year. Savings is a given in their monthly budget and they know it is an essential part of meeting future financial goals.

3. They Plan for Emergencies

Successful savers and investors know that financial emergencies happen. And they have money set aside for these occasions.

Three to six months’ worth of living expenses is a good savings goal for an emergency fund.

But even having a couple thousand dollars tucked away in a savings account can make a big difference to staying on track with finances when a large financial expense comes your way.

4. They Pay Themselves First

Successful savers and investors put their savings goals first. Before anything else, money from their paychecks gets put aside for saving and investing – 10% is a good starting point.

Depending on their income and other financial commitments, some savers and investors are able to dedicate 25% of their income and even more to saving and investing.

So get in the habit of saving first. Whenever that money from a paycheck hits your checking account, move a chunk to savings and stick with this pattern month after month. Consider saving before the money hits your checking account by joining an employer’s 401(k) plan and having pre-tax money set aside for retirement.  Opening an individual retirement account is another good saving and investing option.

5. They Live Below Their Means

Successful savers and investors live below their means. If they spent every penny that they earned, they wouldn’t have the money to set aside for future goals.

To be a successful saver, you must spend less than you earn on a consistent basis.

If on the other hand, you are spending beyond your earning capacity and monthly income, you will accumulate debt, making it more difficult for you to save.  You also risk damaging your credit if you overextend yourself on debt and fall behind on your payments. You can see how your debts are affecting your credit by getting your free credit report summary on Credit.com.

When you borrow, you must pay back all that you borrowed and all the accumulated interest and finance charges owed to lenders.

Borrow too much and the money that could be put aside for savings and future goals gets paid to lenders instead. To see just how much the money you are borrowing is costing you, use this lifetime cost of debt calculator.


Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • Dave C

    One key element that is not here is budgeting. We plan each month where each dollar is going to go and by doing so, we are able to realize out target amount for investing and saving. We do Cary a six month emergency fund as this article suggests

  • Carroll George

    I’ll be 96 in October. I contributed $200/m to my monthly mortgage payment for my retirement condominium. My rate of return was 2.55 times the mortgage interest rate, interest savings, non taxable. No concern about the market.
    I paid off my grand daughter’s mortgage giving her a $300 less per month mortgage in her time of greatest need with 5 young children. Just a couple of ideas reference savings.

    • http://www.Credit.com/ Gerri Detweiler

      That’s great! Thanks Mr. George.


Sign up for your free Credit.com account. Learn More
  • Meet Our Expert

    lucy_lazarony GravatarLucy Lazarony is a freelance personal finance writer. Her articles have been featured on Bankrate, MoneyRates, MSN Money, and The National Endowment for Financial Education. Prior to freelancing, she worked as a staff writer for Bankrate for seven years. She earned a bachelor's degree in journalism from the University of Florida and spent a summer as an international intern at Richmond, The American International University in London. She lives in South Florida.
  • Stay Connected to Our Experts

    Please submit your email address to get credit & money tips & advice
    from our team of 50+ experts, delivered weekly to your inbox.
X

Check Your Credit For FREE

Free Credit ScoreGet a FREE personalized credit check-up today.

Get Started – It’s Free!  

Certain credit cards and other financial products mentioned in this and other articles on Credit.com News & Advice may also be offered through Credit.com product pages, and Credit.com will be compensated if our users apply for and ultimately sign up for any of these cards or products. However, this relationship does not result in any preferential editorial treatment.