Want to feel empowered by money? Learning to save is one way to do it.

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With a 4-step plan, I was able to identify my expenses and start saving for the future.

Step 1: Track your monthly expenses

Understanding where your money is going will provide a clear road map to saving.

  1. Download an expense tracker app on your phone (such as Mint, Money Manager, or Every Dollar). Don't want to use an app? Pen and paper works well too!

  2. Record all of your purchases for one month. This includes any necessary cost of living expenses such as rent, groceries, transportation, etc.

  3. At the end of the month, compare your total expenses to your monthly income.

A woman shimming up and down with excitement because her expenses are in order.


Which expenses are necessary to record? Select all that apply.

Step 2: Categorize your spending

This will help you determine necessary costs and reveal areas where you might be overspending. When I did this, I realized I was spending too much on my monthly phone bill. This led me to switch providers so I could save more.

Separate your monthly expenses into 3 to 4 categories by determining which expenses are:

  • needs — things you have to spend money on to survive

  • wants — things you like to spend money on but aren't essential

  • savings — saving accounts, emergency funds, or investments

  • debt repayment — student loans, credit card debt, or car loans

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Step 3: Make a budget that includes saving

Don’t wait until you have leftover cash to start putting away money! Viewing savings as a necessary expense was fundamental to helping me save.

  1. Make a realistic budget that makes savings a part of your monthly expenses. Aim to save 20% of your after-tax income. Not able to save 20%? No problem! Start small and work your way up.

  2. Set up monthly automatic bank transfers to your savings account. This makes saving a part of your monthly routine and reinforces it as a necessary expense.

    Kevin Durant shouting enthusiastically,

Step 4: Use multiple bank accounts to manage your money

  1. Keep money for necessary living expenses in one account. 

  2. Put your savings into another account, preferably one at a different bank.

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Having your saving account at a different bank can help prevent you from digging into your savings when temptation arises. Electronic bank-to-bank transfers are usually free but take 2-5 business days.

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Ready to grow your savings?


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