Saving Early: Key to Successful Future

For Johnnie Lovett, a Young Illinois Saver, saving has been a habit since he was a teenager. “As a teenager, I was responsible for buying certain things with my allowance,”

the Illinois State University junior said.

“I found out I wasn't always able to buy the things I wanted.” His parents introduced him to the concepts of budgeting, saving, and money management. He has taken that advice to heart and is now regularly saving.

Saving is important for young adults, Johnnie said. “As young adults, we don’t realize how much money we have our hands on because we’re constantly spending.” He said his parents taught him that “saving is a habit and it’s essential to living.” Those lessons were reinforced in the financial literacy classes Johnnie enrolled in through his school and business program.

Like most college students, Johnnie has to balance his needs and wants. To deal with temptation, he saves first prior to spending. He then makes a list of the things he needs and the things she wants and gives himself a budget for both. He also keeps $200 in a separate account, not in his checking or savings, in case of emergencies.

As part of his regular savings plan, Johnnie allocates money towards his short-term and long-term goals. One of his long-term goals is to purchase a house when he graduates. “Owning a house is part of my long-term financial plan, so I’m putting aside money towards a down payment now,” he said.

Realizing that saving is habitual, Johnnie says the best way to get started saving is to start small. “The best way to save is to pick a goal amount, such as a percentage or dollar amount, and save that out of every paycheck. Stick to your goal, rather than trying to save an entire paycheck, which isn't realistic,” he said.

 

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Tip of the Day

  • Tip to Save During the Holidays: Decide how much you can spend. http://ow.ly/pX9nu via @Bankrate

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