Savings week also encourages responsible spending

ALEXANDRIA, Va. (2/23/09)--Saving money goes hand in hand with responsible spending during tough economic times, and America Saves Week--which ends Sunday--focuses on both.

Consumers came close to saving more money in the last three months of 2008 than in 2005 and 2006 combined. The personal savings rate jumped to 2.9% of disposable personal income as consumers squirreled away $310 billion in the final quarter of 2008 (fool.com Feb. 12).

While the increase in the personal savings rate is a step in the right direction for consumers, experts agree that the savings rate will need to climb to at least 6% to be an adequate amount for people to rely on during tough economic times (Businessweek.com Feb. 15).

So, how can you save and spend responsibly? For the third year in a row, hundreds of local and national organizations promote better savings and spending habits through events, positive press, and the Internet during America Saves Week. Visit Americasaves.org to enroll and make your dreams a reality.

In addition to the nformation provided through America Saves, here are a few tips to help you improve your savings habits:


Re-evaluate spending. You may find extra money to sock away into savings. For example, you could skip one pizza a week, downgrade your cable package, or use the library instead of purchasing books.


Look for layaway. Layaway programs provide an alternative to using your credit card. You pay a small fee up front, make regular interest-free payments over a period of time, and take the item home from the store once you've paid the full purchase price. But there are downsides to layaway. Not every retailer offers it, and typically there are cancellation fees and returned-check fees. Make sure that you're able to make the payments over the agreed time, and check the store's layaway policy before you plunk down your cash.


Automatic deductions. Specify an amount to be automatically deducted from each paycheck and deposited directly into your savings account. Before you know it, you'll forget that the amount is being deducted from your paycheck and your savings will continue to accumulate. Ask the credit union or your employer how to set up the automatic transaction.

For more information, read "10 Ways to Spend Smarter," "A Dollar Saved is Two Dollars Earned" and "Living Within Your Limits" in MoneyMix: Launch Your Life.

courtesy of cuna.org