What is the Connection Between Goals and Savings? Tips on Setting Savings Goals

Jessica Quindlen: [00:00:00] Welcome back to the Sound Cents Podcast. I'm Jessica Quindlen. Today we're talking about all things savings and setting those goals. I'm joined by Emma Protsik, our Supervisor of Financial Coaching. Hello, Emma.

Emma Protsik: Hi, Jess. How are you doing?

Jessica Quindlen: I'm good. How are you?

Emma Protsik: Good.

Jessica Quindlen: And Laura Straub, our Community Educator. How are you, Laura?

Laura Straub: Good. Hey, everybody.

Jessica Quindlen: Good. Hello. Hello. All right, so let's start right off with you, Emma. Why is savings important and why is it important to create goals around it?

Emma Protsik: So I think a lot of us kind of have a general idea of those goals that we want to achieve financially, but really taking the time to take a step back and identifying those specific goals can help you understand what all is needed to achieve them. So really about visualizing where do you want to be and how are you going to get there?

Setting those goals, putting them down on paper, having those laid out is really going to help motivate you to save the money you need to achieve those things.

Laura Straub: Yeah, absolutely. And just to add on, saving allows us to purchase products or services that we want without having to necessarily go into unnecessary debt.[00:01:00]

Jessica Quindlen: I love that. So, Laura, what can I do to start to establish some savings goals? Where do I even begin?

Laura Straub: Right? Just identify those needs and wants in our lives. What is it that we need to have in our savings? Versus just what we want to and what goals do we have going forward.

And then research. A lot of the time you can find savings accounts that you get a little bit more back. There's lots of different options out there and what timeline that you need for the savings to accumulate. And then crunch those numbers. So, figuring out that pattern. Am I saving $5 a month or $5 a week or what that may look like.

 So, figuring out how much you can contribute monthly by looking at that budget. So again, that example, can you do $5 or can you step it up and do $25 a month? So just really figuring out what's realistic to you and your situation right now can really help you out when you start to save.

Jessica Quindlen: Yeah. And it sounds like there's definitely different types and different things to be saving for long term, short term. [00:02:00] So Emma, can you kind of talk us through the different savings types?

Emma Protsik: Yeah, definitely. I'll hit on some. There is definitely a lot out there. So it's always good to set those savings accounts for specific goals.

The first type of savings that you should really be trying to prioritize to help you achieve those goals is what we call periodic savings. A lot of folks call this sinking funds as well. So this is where you're setting aside money for those once in a blue moon expenses. Think car registration, especially living in Colorado, which can kind of sneak up on you and take a big chunk of change outta your budget.

So being able to, like Laura said, think about your situation. What expenses do you have? Instead of waiting until that registration again, for that example to be due, can you be putting aside something monthly? So by the time that you need to make that payment, it's not eating away your entire budget for that month.

So it's all about, again, that big picture when we're looking at our different savings goals. The next type, and what I would argue is definitely the most important to have, is our emergency savings. So when life happens, because it unfortunately does, [00:03:00] happens to all of us, it is really good to have some money set aside strictly for that emergency.

So you're keeping your hands off of it unless you absolutely need to use it. It's all about just defining an emergency and what exactly that means to you. And then another savings type, which is definitely the more fun one, would be any sort of long term or short term savings goals that you have. So, this can be the fun stuff.

Maybe you are saving up to buy a car. Maybe it's looking longer term, more at retirement. It can also be implemented for life transitions. Maybe you're thinking of having children or going to school. Setting up those specific savings goals and accounts dedicated to those will really help you.

Jessica Quindlen: Fantastic. I love all of that. Laura, what are some tips for staying on track?

Laura Straub: Automate it is the biggest one. So having it so you know, from your direct deposit, even some go straight to saving, or you do that on the back end too, where you move stuff right away to your savings can really help you. I know that was something I had to do just to Yeah start saving.

Jessica Quindlen: No, I do it too. I have automatic transfer at the end of the month to my savings and my [00:04:00] daughter's savings. I just don't even know what happens.

Laura Straub: There you go. So, yes, that's a big one that can help a lot of us. And then naming our accounts can also help tie it to those goals that Emma was talking about too, of like, this is my emergency account, this is that fun long-term goal I have, or whatever it may be.

We joke too, on our team, we all love tacos, so having a checking account for your taco nights can be just something fun to label your account so you're kind of having that attachment to that money. So then when you do have to take away from it, you have to kind of think like, oh, I'm taking away from this trip that I said I was going to save up for, for something unrelated.

So just having that nice little emotional attachment to that money can really help you when it comes to savings there.

Jessica Quindlen: So that's hilarious. I have to ask, do either of you have accounts named tacos?

Laura Straub: Not yet. But honestly, with how much our team likes to go out for tacos, I might.

Emma Protsik: No, name them. Make it fun. Again, like Laura mentioned, it's that emotional connection and if you want to take it [00:05:00] a step further, research has actually found that tying a specific date to the name, so tacos is not the best example. So, let's say maybe.

Laura Straub: Like a trip to Italy.

Jessica Quindlen: Like June vacation or something?

Emma Protsik: Yep. Okay. June vacation, 2025.

So, oh, by seeing that date, you're actually 40% more likely to keep the money in there, because again, you're visualizing that goal. Having that connection to it.

Jessica Quindlen: Oh, I love that. I'm going to add some dates to mine. Oh yeah. That's great. Tacos though. I'm sorry. That is too funny. I love tacos too, so I get it.

Laura Straub: Exactly, you can have the fun stuff in there.

It really does help us stay accountable to that when you do have some fun things thrown in there where it's not all just those bills and expenses that we do, you know, have to save up for too. So having some fun ones with it. And then celebrating the small stuff. So just like working out, when you accomplish that goal that you set out to, celebrate that.

It doesn't have to be with the money, but it could just be celebratory, like I did it. I did save my goal, I got there. Just having that reflection piece can really help. And then of [00:06:00] course on the flip side, giving yourself some grace. If something comes up and you weren't able to do something or accomplish that goal just in the same timeline that you were thinking, but you know, you still accomplish it.

Giving yourself that grace too is always helpful to keep you plugging along.

Jessica Quindlen: What about some of those moments where you might come into, you know, a decent amount of money, a bonus, tax refunds, birthday, et cetera. What can we do there? Because sometimes I know myself even the impulses to plan something big or buy something big.

Laura Straub: Spend it.

Jessica Quindlen: Exactly. Spend, spend, spend exciting. Should we always be trying to save that? I know it's, it's obviously dependent on the person, but I'd be curious of your perspective there.

Emma Protsik: You know, I think it depends, like most things in the world, unfortunately. But when it comes to those windfalls you're talking about, so the tax refund, maybe those bonuses our brains just automatically tend to view that money differently.

To your example, “oh, I have extra spending money, I can buy that nice thing.” And first off, just want to make it clear, there's nothing wrong with buying nice things that you want. Again, it's money that you [00:07:00] can budget for. Set those goals aside, but just trying to shift your thinking around kind of those more surprise monies or the ones that you don't include into your traditional budget can really help you jumpstart your savings goals.

So looking at those, and maybe it's putting aside half of that tax refund, right? So leave some monies, have some fun with those bonuses and again, just try to work savings into the mix somewhere in there can really help you out.

Jessica Quindlen: No. Absolutely. And I think it's, you know, it's always finding that balance of enjoying life. Enjoy the moment life is short. But also preparing for emergencies, retirement, absolutely. College tuition, all those kinds of things. So it's, you got to find that balance. All right. So I think this question is quite relevant to how we are now and we are doing an entire podcast around sort of inflation.

But I am curious of specifically some tips on saving when your income may be low and or your expenses are high, or frankly, the expenses in general are high as per inflation. What are some tips we can do then so we don't just completely fall off some of those [00:08:00] goals we may have?

Laura Straub: Yeah. So first off, just looking at your budget.

Reassessing it. So, are there things in there that you may not need or that you're spending money on that you didn't know you were spending it? So just re-looking at your budget in full detail. So, really scrubbing through and then looking at those costs and expenses and seeing where are some ways that you can either join efforts in those costs.

So carpooling, for example, if you live close by a coworker, why not carpool? Or looking at our subscriptions, things that like, maybe we can share our subscription services, or maybe it's time to put a pause to some of those. And then trying out new stores or different ways of shopping.

So shopping used or Facebook marketplace or just all of those different types of ways that we can get our items and products nowadays can really help you in the long run too. Just unconventional ways that you can look at for saving some money. So that way you're cutting down on those expenses [00:09:00] and therefore able to still keep up with your savings goals.

Jessica Quindlen: Fantastic. Any others?

Emma Protsik: Yeah, I think too, it's always a good idea to keep in mind that there are resources and support that you can find if you looked at that budget, you cut everything you can and you're still not in a spot that you want to be in.

If you don't know where to start with finding those different resources and support that's available to you there are some great organizations that can help you do that matchmaking. So United Way for example, they are nationwide. They have a program called 211, which is also the phone number you can call, they have a website as well. But you can call into the 211 program, let them know your situation, and they'll really help you take a step back and figure out what organizations, different nonprofits, might be able to help you.

So for example, a lot of people are looking for housing assistance, especially nowadays with the cost of living going up and the inflation mixed in with all of this. But housing assistance is actually one of those ones that's a little bit more difficult to get approved.

There is a big need there, a lot of applicants. So calling an organization like United Way, they might be able to help you find some other support you can [00:10:00] receive. So maybe it's food assistance or utilities assistance that can help you offset some of those costs so your budget doesn’t feel so very tight.

But again, just doing your research, seeing about different assistance programs out there and then definitely depending on the family, but family and friends, I think it's good to keep in mind that you are not alone if you're feeling this. We've all had financial problems, especially nowadays, so depends on the relationship of course, but just reaching out to them, maybe there's something they can help you out with as well.

Jessica Quindlen: Fantastic. I love that. Anything else you'd like to add?

Laura Straub: Now, it's not for everyone, but thinking of how you can increase your income too, is another way that you can help with your savings goals. Can you sell things? Are you into hobbies where you're making scarves and things like that where you can then offset some of your expenses with that income can also help you.

When times are tough too, just looking at different ways that you can kind of bring in some extra cash that way, again, you can keep those savings goals in place too.

Emma Protsik: Something my fiancé and I did when we were [00:11:00] needing some cash in college. We actually DoorDash together. So, it sounds kind of funny, but it made it less…

Jessica Quindlen: Didn't feel like work because you were hanging out.

Emma Protsik: Yeah. Just felt like we were hanging out. Yeah, but I mean, even things like DoorDash, right? Picking it up here and there can be really beneficial. It's not a full-time job by any means. And I've had a lot of friends actually start dog sitting recently. There are some apps you can use to do that. Get to watch some dogs, get some money.

It's kind of like a win-win there. But I think when it comes to looking for a second job there comes a time where it is required just looking at expenses, right? And income coming in. Try to make it as beneficial to you as possible. So, getting a job at a grocery store that can provide maybe a discount on groceries might be more beneficial than working, I don't know, let's say a yogurt shop.

I do love frozen yogurt. But again, looking at the big picture there, can you get those discounts? Are there extra benefits in those different jobs as you're doing that search?

Jessica Quindlen: Interesting. I love all of that. Well, awesome. Well, I have to ask each of you as we're talking about this, what are you [00:12:00] saving for right now?

Laura Straub: Yeah, right now we are saving for a trip to Italy. It's been a dream of mine forever. So we're finally making it realistic by setting those goal dates and getting them in place. So yes, we have an account labeled that. And I'm going to add the date now that Emma mentioned that.

Make it a little bit more real for us. So yes, saving for Italy.

Jessica Quindlen: Italy is fantastic. You will love it. Oh, so great. And how about you Emma? What are you saving for now?

Emma Protsik: I want to say I'm saving to go to Italy with Laura, because that sounds amazing. My fiancé and I are getting married later this year, so definitely still saving for some bits there.

And then we are going on a little honeymoon. Definitely not, anything quite like Italy, but we're saving some money to be able to do some fun things and enjoy that time together.

Jessica Quindlen: Great. I love it. Absolutely. Hey, any savings goals are great goals. Well, awesome. That brings us to the end of our show. Laura, Emma, thanks so much for being here. It was great having you.

Emma Protsik: Thanks Jess.

Jessica Quindlen: Thank you for listening to Sound Cents from Ent Credit Union. Be sure to follow our podcast as well as rate and review us. I'm [00:13:00] Jessica Quindlen. I will see you next week. Same time, same place.