Yahoo Finance 6 Magic Money Moves To Boost Your Savings Before 2025
If you set a savings goal for 2024, you’re now past the halfway point of reaching it. People who are running ahead of their savings goal for the year should look at the next six months as an opportunity to stay ahead rather than apply the brakes. If you’re behind on your savings goal, then you’ll want to come up with a strategy to accelerate your savings during the latter half of the year.
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In terms of “magic” money moves to boost your savings before 2025, the main magic behind them is committing to doing them in the first place. That might be the most important ingredient in building savings and wealth — the will and discipline to follow through on your plan.
Here are six moves you can make to boost your savings before 2025.
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Pay Down Credit Cards
High-interest debt in the form of credit cards can be a savings killer because so much of your earnings goes into paying it down. That’s why it’s important to pay off this debt ASAP. There are numerous strategies for eliminating credit-card debt quickly — including the “snowball” and “avalanche” methods. The important thing is to start now.
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Earn Extra Income
Another surefire way to boost your savings before 2025 is to increase the amount of money you have coming in and put that extra money into savings. This doesn’t mean you need to invest more time and energy than you can spare. There are ways to make money that don’t require a huge commitment. They range from renting out a room in your house to letting companies put ads on your car.
Treat Savings Like Any Other Bill
Saving money should not be considered a financial luxury but a financial obligation, just like your rent, mortgage, power bill or internet service. If you haven’t done so already, make a budget that includes a certain amount of savings each month. Build your emergency fund first, then move on to different savings goals such as large purchases, education and retirement.
Set Up Automatic Transfers
One way to ensure that saving money becomes a financial habit you don’t have to think about is to set up automatic transfers into your savings account. This relieves you of having to make the transfer manually while also guaranteeing that your savings balance grows on a regular basis.
Open a High-Yield Savings Account
One of the biggest financial mistakes you can make is to put your money into a savings account that pays a minimal interest rate. The average savings account rate as of June 17, 2024, was 0.45%, according to the FDIC. That’s better than the 0.01% rates you’ll find at some banks but much less than you will get when you open a high-yield savings account. The best high-yield accounts pay annual percentage yields of 5.0% or more. You can do yourself a big favor by researching the top accounts and opening the one that best fits your needs.
Max Out Your Retirement Account
If you are not currently maxing out your retirement savings each year, now is a good time to start. In 2024, the contribution limit for employees who participate in traditional 401(k) plans is $23,000 a year if you’re younger than 50. If you are 50 or older, the catch-up contribution is $7,500. This is an especially good strategy if your employer offers matching contributions. If you have an IRA, the 2024 limit is $7,000 for those under age 50 and $8,000 for those age 50 or older.
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This article originally appeared on GOBankingRates.com: 6 Magic Money Moves To Boost Your Savings Before 2025
