How To Start A Savings Account In 8 Easy Steps

    Adultify your finances

    by Irina Grechko · August 22, 2016

    The time has come to accept the inevitable: You’re growing up. Embrace it! Becoming an adult can be daunting, but not when you have guides as easy (and, let’s face it, as cool) as the ones in our new Adultify series. Now, you won’t ever have to utter that cringe-worthy term “adulting” when you accomplish something, like doing your laundry—you know, basic, responsible grown-up activities—because you’ll know these truths to be self-evident.

    It is a truth universally acknowledged that an adult in possession of a good fortune must be in want of a savings account. Butchered Jane Austen prose aside, it is an unavoidable part of responsible adult life to take care of your finances. And that doesn’t just mean making sure you’re paying off your credit cards on time and not overdrafting—although it also means that.The reality is that you need some cash squirreled away not only for your retirement (which is probably in the far-off future), but also in case something goes wrong (a medical emergency, loss of job or home) in your life.

    “You need a doomsday fund, a treasure chest, an ‘oh, crap’ fund, a ‘break in case of emergency’ fund. Not to mention a ‘because I want to live fabulously in retirement’ fund! Whatever you want to call it, you need one before you do anything else with your money,” says Nicole Lapin, financial expert and New York Times best-selling author of Rich Bitch. “That wad of cash under your mattress isn’t going to do you any favors.” Instead, she suggests tucking a little bit of your paycheck away each month. “While the purpose of your checking account is generally to cover monthly bills and daily transactions, your savings account is designed to help you preserve and ideally grow your balance over time,” says Brandie Farnam, LearnVest's manager of advice excellence. “That potential for growth comes from any interest you earn on the balance, as well as any additional contributions you make to your savings account.” But even with the best frugally motivated intentions in mind, sometimes stashing anything away seems hard, thanks to the ultra-low entry-level paychecks which exist in pretty much every industry. Add in the fact that most of us have student loans and general high costs of living with which to deal, and a savings account seems damn-near impossible. With that in mind, we consulted Lapin and Farnam to get their tips on how to put away money even while living that paycheck-to-paycheck lifestyle.To begin, there's one thing they both can’t emphasize enough: You should start saving as early as you possibly can. “Don’t wait! Having a safety net is essential to your financial health and will help you build a solid foundation,” says Farnam. “That way, you build good money habits and can gradually increase your contributions over time.” In other words,whether you’re saving for the iPhone 7 or a long-term goal like a vacation or retirement, it’s time to get to the bank and open a savings account. Read on for our 101 on savings.

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