4 Saving Strategies I Swear By for Long-Term Wealth

July 13, 2024 DINARRECAPS8

I’m a Banker: 4 Saving Strategies I Swear By for Long-Term Wealth

Angela Mae Thu, July 11, 2024 GOBankingRates

When it comes to saving money, there’s no one-size-fits-all strategy. What might work for some people won’t always work for others. Depending on your goals and financial situation, you might be able to save more aggressively than others. Or you might only be able to save small amounts at a time over a long period.

Whatever the case, if you’re trying to build long-term wealth, it’s crucial to find the savings strategy — or strategies — that work best for you. If you haven’t found yours yet, don’t worry — it’s never too late to get started.

GOBankingRates spoke with Teri Williams, president and COO at OneUnited Bank, about which savings strategies she swears by for long-term wealth — and which ones she would outright avoid. Here’s what she said.

Automate Those Savings

One of the first things Williams suggested was setting up an automatic savings account.

“What wealthy folks know is that you MUST set up an automated process such [as] that funds transfer from your paycheck to a savings/investment account,” she said. “If money goes ‘into your pocket,’ you are more likely to spend it.”

Most banks and credit unions, as well as online banking services, will allow you to connect two accounts — like a checking and savings account — and automate your savings contributions. Depending on your goals and finances, you may be able to set it up to where a certain amount of money gets deposited into your savings account each month. Or you might be able to have a specific percentage of your paycheck put into your savings.

Check over your budget and see how much money you can comfortably save each month. You can always make adjustments as you go, but the important thing is getting started.

Prioritize Increasing Your Income

If you’re trying to save money to build long-term wealth, you’ve probably been told to cut out that daily latte habit or cancel those extra streaming service subscriptions. And while cutting back on things you don’t need, want or even use doesn’t hurt, it’s not the way to become wealthy.

Instead, Williams suggested focusing on your income over your expenses.

“The wealth gap, as an example, is largely due to the income gap, rather than a difference in how we spend our money,” she said. “Avoiding purchasing a cup of coffee or lunch is not as important as improving your job skills and career path.”

These small cut-backs might help in the moment, but your actual earnings are what are more likely to push you into greater financial stability and wealth over time.