ON THE MONEY > LIBRARY > FINANCE > SAVING FOR LIFE EVENTS
Make Lasting Memories, Not Lasting Debt
The Basics
While instant gratification feels good, it's important not to impact your long-term financial security. You can plan smartly to pay for bigger things like a wedding, a home, or buying a car without going into unmanageable debt.
General savings advice can be found in our Basics of Personal Finances blog. This includes things like having emergency savings, paying down debt, and, most importantly, creating a budget.
Saving for a Purpose
You’ll typically have a set beginning and end and dollar amount needed. It’s a good idea to open a separate account specific to your saving goal to ensure the money you use is for that purpose and isn’t accidentally taken from emergency savings or money needed toward paying down debt. Consider opening a high-yield savings or other investments to make your current funds grow faster.
Regardless of what you’re saving for, the first thing you should do is to establish a budget and stick to it. For big, exciting life investments it's easy to get carried away and spend more than you can afford. If you haven't made a budget, this can be scary but reviewing your past expenses for the previous few months can help you get an idea of your spending habits.
Ways You Can Save
Buying a Home
Fixer Upper – While it requires more effort, the initial purchase price may be lower.
Embrace Secondhand – Buy used furniture, appliances, and other household items instead of new ones.
Rent Out Space – If you have a spare room, consider renting it out. This can offset your living expenses and accelerate your savings.
Weddings
Reception Only – Have a private ceremony (or elope!) and save your money to celebrate with friends and family later.
Timing – Select off-season dates. The time of year and day can have a big influence on how much you’ll be charged.
DIY – Make your own decorations and invites, which can add that personal touch to your big day.
Children
Resell Items – When your child outgrows items, resell them to recoup some of your initial investment.
Homemade Fun – Get creative and make your own toys or activities using household items.
Free Resources – Visit your local library for free story times, playgroups, and educational programs for children. Look for free activities in your community.
Buying a Car
Consider Used – The savings you can reap with a car a few years old (versus a brand-new car) can be huge.
Define Your Needs – Are those extra features a need or a want? Every feature adds more to the cost of the vehicle.
Time of Year – Car dealerships often have sales and promotions at the end of the year or during specific holidays.
Additional Things to Consider
Buying a Home
Having a place of your own can feel amazing. But there are many considerations that go into buying a home. Read more about that in our blog Buy or Rent: Pros and Cons. Based on your current finances, how much can you afford to spend? Along with mortgage loan payments you’ll need to consider costs associated with a down payment, insurance, and general home maintenance.
Getting Married
Love is a wonderful thing…trying to newly navigate the finances between two people can be a bit more complicated. Having a conversation about money before marriage is vital. It’s important to discuss spending and saving habits, how or if you’ll combine incomes, and where the responsibility falls for making various payments. Plus, you’ll want to have a plan for the future that you both agree upon and work toward together.
Having Children
Having children is a joyful but often expensive life event. When you’re ready to take that step be sure to think about the impact it will have on your wallet. With a new person to care for, you’ll need to allocate your money differently. But reassess often: as your child gets older, needs will change and the plan you have for a baby may be different for a toddler or school-age child. Also, don’t forget about employer benefits like health insurance and flexible spending accounts, or government programs that can provide financial assistance.
Purchasing a Car
Buying your first car can be exciting, but it’s also a big investment – make sure you do it without regrets. It may be tempting to buy a flashy sports car, but you need to decide what you can realistically afford. You’ll have a monthly car loan payment as well as additional recurring costs such as insurance, maintenance, and fuel. And think about how often you drive. If you work from home or have public transportation readily available, do you need to buy a vehicle with tons of extra features you won’t use? Be practical. Remember, you don’t have to live like your favorite influencer…your wallet will thank you later.
Additional Resources
High-Yield Savings
A high-yield savings account is great for anyone who wants their money to earn more without taking on risk.
Home Loans
Whether you’re a first-time homebuyer or looking to refinance, get clear information that helps you move forward.
The Basics of Personal Finance
Mastering your personal finances can be empowering, helping you build a secure future to live the life you want.