1. Introduction to Saving

2. Saving Basics
Savings is the portion of current income not spent on consumption.
Savings accounts provide an easily accessible place for people to store their money to meet daily living expenses and to have money for emergencies.
Financial experts recommend individuals keep a minimum of three to six months of salary in a savings account.

3. Savings Account Uses Daily Expenses Emergencies Future Purchases
Future Investing

4. Saving vs. Investing Saving The portion of current income not spent.
Place to store money for daily expenses and for emergencies.
Generally yield a low interest rate.

5. Saving vs. Investing cont.
The purchase of assets with the goal of increasing future income.
You should develop and implement a savings plan before beginning an investment.

6. Reasons People Should Save
Emergencies –Examples of emergencies can include illness, losing a job, or immediate need to replace something (such as a flat tire)
Expenses – It’s important to know your regular (fixed) monthly expenses as well as your ever-changing (flexible) monthly expenses. Savings accounts can be used as a budgeting tool to manage these.
Future Purchases – Money can be used to meet future goals such as a college education, new car, down payment on a home, or a new stereo.
Investing – After an individual has established a savings account, money should eventually be invested for future income. (Example: Retirement)

7. Why People Don’t Save
People feel their needs and wants are not being met so they spend more money.
People do not realize how much they need to be saving or investing for future goals.
Money in savings accounts earns such poor interest rates. It barely (if at all) keeps up with inflation. Investing usually gains higher interest rates. (Example: Cousin Brian who invested every penny he had and lost it all. Saved nothing.)
People justify not needing money for emergencies because they have a credit card they can use. (Not the best idea!  )
People feel they have adequate insurance and job security; therefore they do not need money for emergencies. (Yikes! Not always true! )

8. Developing a Savings Plan
Track spending for one month to determine where money is currently going.
Evaluate spending and determine where money can be saved.
Decide what amount will be put into savings per month, put decision into writing and stick to it!
 Be willing to make adjustments. If the savings plan is not working evaluate why.

9. Developing a Savings Plan
Track spending for one month to determine where money is currently going.
Tell me one thing you religiously buy every day/week…
Let’s do some math!

10. “Pay Yourself First”
Put money away into a savings account or investment BEFORE you pay other bills or use for spending.

11. 70-20-10 Rule Spend 70% of money you earn Save 20% of money you earn
Invest 10% of money you earn

12. Conclusion
Savings accounts provide an easily accessible place for people to store their money.
Savings accounts can be used for daily expenses, emergencies, future purchases, and future investing.
It is recommend that individuals keep a minimum of three to six months of salary in a savings account.
Investments generally have a higher rate of return but are harder to convert to cash than savings.
Pay yourself first.
Develop a savings plan, write it down, and stick to it!