How to Start Saving Money

To start saving money, choose a realistic amount you can put aside from each paycheque and make it automatic.

You don't need to start with a large amount—even consistently saving $10, $20 or $50 can help you build the habit.

Start with an amount you can realistically afford and gradually building your savings over time.

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It is a prepaid Mastercard, so you spend your own money while still earning high interest.

With KOHO High Interest Savings, you can:

• Grow your savings up to 3.5% interest

• Earn a 2% cash back rate on groceries, eating, drinking, and transportation and 0.5% cash back on everything else

• Unlimited transactions and free e-transfers

• No minimum balance required, ever

1. Figure Out How Much You Can Save

Start by looking at your income and monthly expenses to see how much money you have left after your essential costs.

You don't need to save a huge percentage immediately. People starting their first job should consider transferring around 5% to 10% of each paycheque toward savings.

If 5% isn't realistic right now, start smaller.

2. Set a Savings Goal

Having a specific goal gives you something to work toward.

Your first goals might include:

• Building an emergency fund

• Saving for a vacation

• Buying a car

• Saving for a down payment

• Making a large purchase

Once you know what you're saving for, determine how much you need and how much you can contribute each month.

3. Automate Your Savings

One of the simplest ways to save consistently is to automatically transfer money into savings when you get paid.

For example, if you get paid every two weeks, you could automatically move $50 into your savings account each payday.

Schedule automatic transfers around payday so the money goes into savings as soon as your paycheque arrives.

4. Build an Emergency Fund

If you're not sure what to save for first, consider starting an emergency fund.

An emergency fund can help cover unexpected expenses such as a car repair, home repair or loss of income without immediately relying on credit.

Work towards approximately three to six months of regular expenses or income, but you can build toward that goal gradually.

5. Look for Small Expenses You Can Redirect

You don't necessarily need to make major lifestyle changes to start saving.

Look for recurring expenses you could reduce, such as:

• Unused subscriptions

• Frequent takeout

• Delivery fees

• Impulse purchases

• Expensive phone or internet plans

If you cut a $20 monthly expense, consider automatically putting that same $20 into savings instead.

6. Keep Your Savings Separate

Keeping savings separate from the money you use for everyday expenses can make it easier to avoid spending it accidentally.

For an emergency fund, choose a savings account that is separate from your day-to-day account, accessible when needed and able to earn interest.

The most important step is simply to start. Choose an amount you can consistently afford, automate it and increase your contributions as your budget allows.