It may come as a surprise, but more than 20 percent of Americans have no savings account. The first step for a young adult to create a savings plan is to open a savings account. There are several different types of deposit products available to fit your needs. Be sure to explore many options to determine what savings product works best for your goals.
In order for young adults to stick to a savings plan, it is important to track where their money goes. Making a budget involves more than simply listing your expenses; budgeting requires self-control and the ability to make sacrifices through curtailed spending.
A budget should have three goals:
Once you set up a budget, you’ll have a better understanding if you are able to spend on non-essential or luxury items.
Some experts suggest that young adults should save up to a third of their income. While this goal isn’t always possible, saving money when you have less financial responsibility is a solid strategy. Savers should pick an amount and stick to it every month, regardless of how much they decide to save.
Student loans can be a heavy burden for young people, but paying off student debt as quickly as possible will help young adults to ramp up their savings plans. With student loan interest rates frequently rising, student debt costs more than your savings could earn in interest.
It may take several years, but focusing on eliminating student debt will allow you to save more money later in life.
It is never too early to start saving for tomorrow. Synchrony Bank offers high yield savings accounts, CDs and many other deposit products, and its award-winning deposit products can help young adults develop savings plans for their futures. Call 1-844-345-5789 to get started on your savings plan or find us online today.
Market Watch: marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06
The Balance: thebalance.com/wants-vs-needs-1388544
*ANNUAL PERCENTAGE YIELD (APY): All APYs are accurate as of 05/24/2018.
APYs are subject to change at any time without notice. Offers apply to personal accounts only. Fees may reduce earnings. For Money Market and High Yield Savings Accounts, the rate may change after the account is opened. For CDs, a minimum of $2,000 is required to open a CD and must be deposited in a single transaction. A penalty may be imposed for early withdrawals. After maturity, if you choose to roll over your CD, you will earn the base rate of interest in effect at that time. The APY shown for CDs and IRA CDs is for a 60-month CD with a balance of at least $25,000. Click here for all CD rates and terms offered.