We all have times when we have the need to save towards a particular need or event. It could be for your wedding day, towards buying a car, renting a home or travelling abroad for vacation. However, what happens most times is that we fail to make good on our intentions because we balk at the discipline required, or get overwhelmed by other pressing needs
Many of us fail to save because we have not yet figured out the beauty of target savings. What is target savings? It is simply one of the saving instruments designed by financial organisations to help their clients save towards a project or set goals over a certain period.
How can you make target savings work for you? First, find a trusted financial institution. Thankfully, this is no longer limited to brick and mortar banks as there are now fintechs that offer this product or service.
Once you have sorted out which financial institution you will save your money with, the next thing to do is set an amount to be automatically deducted. This amount will be deducted from your salary or business account at the same time, either on a weekly or monthly basis, until you reach your goals.
The wonderful thing about this product is that you don’t have to worry about whether or not you remembered to save this week or last month. It automatically does the job of saving for you and helps you be disciplined in regularly putting away money towards your goals so that when the expected time comes to pay for your wedding or your dream vacation, you don’t have to stress yourself out looking for loans. The money is there waiting to be used. The added benefit is that while you save, you also earn interest.
Another way to use your target savings account is to put away money during the holidays or birthdays. Sometimes, during these occasions, you receive monetary gifts from loved ones. Instead of squandering them, you can put them in your target savings account.
You also don’t need to wait for big goals. You can start practising by saving small amounts daily, weekly, or monthly.