What Kind of Saver Are You?

We all know it’s smart to save money, but savings strategies can vary a lot. It all starts with figuring out your financial goals, building an emergency fund and building good money habits. Then, implementing some strategies that match your savings approach will help you achieve success.

Different Methods of Saving Money

If you’re wondering how to save money and find the best saving methods for you, we’re here to help. Look for your style in these types of savers and use the suggestions to put some new ways to save into practice.

1. The Spendthrift. Savings — what’s that? The Spendthrift lives for the moment, spends money as soon as they receive it and has little to no savings. If you’re a Spendthrift, be aware that just one small life event, such as a broken down car or medical emergency, could cause you to go into debt.

   • How to Save if You’re a Spendthrift
     If you’re not currently saving any money, start small by tracking your purchases with an app like You Need a Budget (YNAB), which helps you prioritize needs vs. wants by requiring you to assign every penny of your current available funds into a specific category (aka “down-to-the-dollar budget”) and then presents recommendations on where to make adjustments.

2. The Sprinkler. The Sprinkler may have a savings account but isn’t consistently thinking about how to save money. They might “sprinkle” $50 into an account one month, $100 into it the next month, but then forget to make deposits for two months because they wanted new designer shoes. If you’re a Sprinkler, realize that saving any substantial amount of money may be difficult if you’re not consistent.

   • How to Save if You’re a Sprinkler
     It’s great that you’re making an effort to save, but in order to truly build your savings, try automating your deposits in a savings account you don’t touch. If you don’t already have one, create a budget and then determine a reasonable, consistent amount to save each month. Then, work with your bank to set up recurring monthly deposits.

3. The Goal-Getter. The Goal-Getter is driven by their desires and has several different “buckets” of money, each with their own goal assigned to them — a new car, big vacation, dream home, etc. If you’re a Goal-Getter, keep up the good work and continue to find saving strategies for what motivates you. If you don’t already have an emergency fund, start one. It may not be as exciting as a big vacation, but it’s a good idea to have a financial safety net.

   • How to Save if You’re a Goal-Getter
     Make sure all your goal-based deposits accounts are consistent and automated. Additionally, use a bank that provides sub-accounts so you can see your total savings in one place.

4. The Autopilot. The Autopilot is in control of their finances. They automate everything. From monthly bills to their monthly savings, they’ve taken the manual process out of their finances. If you’re an Autopilot, you’re succeeding in streamlining your financial life. Just don’t forget to reevaluate your monthly contributions on a regular basis and adjust them according to changes in your income and expenses.

   • How to Save if You’re an Autopilot
     You’ve already done a great job by making regular contributions to your savings, but how can you make your savings more effective? You could try:
     - Moving some of your savings to a CD to receive a higher interest rate.
     - Opening an additional savings account at a bank offering new customer incentives.
     - Making additional monthly contributions with automated investing.

5. The Spreadsheet Savant. Your friends may think you’re frugal, but tracking everything you spend — down to a pack of gum — is just your way of life. You don’t like waiting for transactions to import into online financial tools, so you track everything in a spreadsheet. All your savings withdrawals are automated, and you know exactly how much comes in and goes out every month.

   • How to Save if You’re a Spreadsheet Savant
     Also consider using more robust tools, like Tiller or Personal Capital, which can automatically update Google Sheets and Microsoft Excel with your daily account balances, as well as allow you to integrate capital investment and stock portfolios into your account.

So, What Kind of Saver Are You?

No matter how you save money or track your finances, the most important thing is to keep doing it. You can always tweak your saving method or find creative ways to boost your savings. Don’t feel locked into savings strategies you’ve always used if they’re not working for you. Just remember that every dollar you save brings you closer to reaching your financial goals.

This article has been updated from its original posting on Oct. 19, 2020. Melina Duffett contributed.