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Black Friday and Cyber Monday are some of the best times to find deals on all the products you love. Whether you’re purchasing something you’ve wanted for a long time or you’re buying a gift for a loved one, you can surely find a sale that will be suitable to your needs.

This year, Black Friday is on November 26, 2021, and Cyber Monday is on Monday, November 29, 2021. In 2020, on Thanksgiving weekend, 186.4 million shoppers in the U.S. bought something, spending an average of $311.75.

Black Friday Deals

Whether you plan to spend a few hundred bucks like most people or use the opportunity to make larger purchases, here are some places you will be able to find great deals for Black Friday and Cyber Monday this year.

1. Amazon

Amazon generally starts showing Black Friday deals during the month of November. Typically, you’re going to get the best sales on the most in-demand items on Black Friday weekend itself, though. Look out for weekend deals on Nintendo Switch, Macbooks, and iPads. Unlike on Prime Day, on Black Friday weekend, anyone can access great deals on products.

2. Target

Target is your go-to brick-and-mortar stop for, well, just about everything you need. Don’t miss out on their Black Friday and Cyber Monday deals this year. The retailer is known for holding sales on toys, home, clothing, electronics, and more. Typically, Target will price match, so you can always look up a price on a site like Amazon or Best Buy and then show it to a Target associate to snag the same deal.

3. Macy’s

Macy’s is already gearing up for Black Friday. If you need to buy some clothes, jewelry, home goods, or gifts for friends and family, then make sure you check out Macy’s sales. You can start shopping on November 23, but take a sneak peak at deals leading up to the day on their website. Make sure you use your Macy’s card to score up to 5% back on your purchases.

4. Walmart

Walmart is notorious for being inexpensive, and on Black Friday weekend, you can score some bigger deals. Walmart.com is already showcasing some of the store’s upcoming sales on electronics, clothing, auto supplies, toys, beauty, kitchen appliances, and much more.

5. Bed Bath & Beyond

Are you moving soon? Do you need to purchase a registry gift for a friend or family member? Are you looking to replace some appliances in your home? Then check out Bed Bath & Beyond’s 2021 Black Friday deals. The store has started rolling out some of their deals and, in 2020, you could get 25% off your entire purchase in store and online with curbside and in-store pickup.

6. The Home Depot

If you’re looking to dive into some DIY projects or need new decorations for the holiday season, then check out The Home Depot during Black Friday weekend. In 2020, the store featured deals on giant, pre-lit Christmas decorations, up to 40% off on select appliances, and $79 artificial Christmas trees.

7. Lowe’s

Another place to get some DIY Black Friday deals is Lowe’s. You can gain access to deep discounts on home improvement essentials and tools, along with decorations for the holidays. In 2020, shoppers could purchase a 46-in-9 wood-top steel mobile workbench for $298 and buy a DeWalt 5-tool 20-volt max cordless combo kit for $279, discounted from $549.

8. JCPenney

Need some new clothes for the entire family? Then check out JCPenney’s Black Friday 2021 sales. So far, they’re offering up to 75% off fine jewelry and up to 40% off Levi’s. You may also be able to snag additional deals if you use your JCPenney credit card to make your purchase.

9. Best Buy

If you want to buy electronics this holiday season, then Best Buy is your best bet. The 2021 deals are set to start rolling out on November 19th. In 2020, you could buy a 65” class and larger 4K smart TV for as low as $249.99. You could also score deals on Apple Watches and other electronics brands you love.

10. Kohl’s

For Black Friday and Cyber Monday deals on clothing, accessories, shoes, home goods, electronics, and more, then look into Kohl’s. Deals will start rolling out on November 21st. If you are enrolled in their rewards program, you may be able to score some Kohl’s Cash and get even more of a discount on your purchases.

11. Overstock

Black Friday has already started at Overstock.com. Expect to find deep discounts on things like mattresses, furniture, and other home necessities. If you join the Club O rewards program, then you can earn up to 40% off on your purchases as well.

12. Chewy

Do you have pets at home? Then don’t forget them this Black Friday and Cyber Monday. Check out Chewy’s Black Friday deals, which included sales on animal apparel, pet toys, dog food and treats, cat food and litter, and flea medicine in the past.

13. Petco

If you prefer to shop in store for your pet supplies, then check out Petco’s 2021 Black Friday deals. According to the store, Black Friday is a four-day event, and you can snag deals online and in the store. There are also pre- and post-Black Friday sales, so make sure you stay on top of the deals by subscribing to Petco’s mailing list.

14. eBay

Whether you need a TV, laptop, video game, toys, or kitchen appliances, you can find what you’re looking for on eBay.com during Black Friday and Cyber Monday.

15. Claire’s

Is there a special teenage girl in your life who may want some new jewelry for the holidays? Then go to Claire’s at the mall or shop their store online. To get more off your purchase, you can sign up for their rewards program and earn points as well as receive 20% off your next purchase.

16. DSW

If you’re looking for shoes this holiday season, head on over to DSW or DSW.com. If you join the VIP club for free, then you’ll earn 20% off on a purchase, then 5% back in rewards on every purchase after that. You’ll also receive free shipping on anything, which can save you big bucks.

17. Nordstrom

Nordstrom features sales on Black Friday and Cyber Monday in store and online. So if you’re looking for clothing, shoes, or accessories for your whole family, then mark your calendar to access deals on Friday, November 26 and Monday, November 29 this year.

18. Forever 21

If you’re a fan of Forever 21, then get ready for their Black Friday deals. Though the sales aren’t yet out for 2021, during the last sale, you could snag 30% to 60% off nearly everything and get an extra 50% off sale items online.

18. Gymboree

Looking to stock up on clothes for the kids during Black Friday? Gymboree has got you covered. In the past, they offered 50% to 60% off everything in the store. You could get t-shirts for $8, PJs starting at $12, and leggings for only $8.

20. Lids

If you want to purchase some sports apparel, like hats, then make sure you check out Lids’ Black Friday and Cyber Monday deals. You can shop online or in the store at the mall to score deals on hats, jerseys, t-shirts, and more. Then, wear your favorite team apparel when watching sports games with your friends.

21. JOANN

Need some fabrics and crafts? Looking to DIY some scarves or hats this winter? JOANN has got you covered with their Black Friday sale. Though the deals for 2021 aren’t out yet, in 2020, you could get up to 70% the entire stock of flannels, sewing machines starting at $69, and 50% to 70% off holiday decor.

22. Lululemon

Do you want to purchase some athletic wear during Black Friday 2021? Lululemon might be the place to check out. In the past, they discounted Wunder Under leggings, outerwear, and sports bras. This year’s deals have not yet been announced, so make sure you go to their website for updates.

23. Office Depot

If you’re looking for deals on everything for your office, then go to Office Depot on Black Friday. This year, deals include up to 40% off on desks, 60% off on office chairs, and up to 50% off print services.

24. Walgreens

Need to print some photos for the holiday season? Then head to Walgreens, which offered 40% off photo gifts and puzzles and 60% off canvas prints in 2020. The store also featured deals on kids’ toys, with buy one get one free sales on Crayola supplies and buy one get one free on playing cards as well.

25. Mattress Firm

While Mattress Firm hasn’t yet announced their Black Friday deals for 2021, if you sign up for their email list, you can save $50 on your first order of $499+. Mattress Firm features all your favorite mattress brands, from Tempur-Pedic to Serta, Beautyrest, Sleepys, Sealy, and more.

26. Harry & David

If you want to send someone a gift but don’t know what they’d like, then Harry & David gifts are the perfect solution. Get a gift basket full of fruit or candy for a loved one on sale on Black Friday. Their 2021 deals aren’t out yet, but chances are you’ll be able to score buy one get one 50% off and up to 30% off select items if the sales are anything like last year.

27. Pottery Barn

Want to add some new furniture to your home? Pottery Barn features classic and contemporary items on sale on Black Friday. Check out the website for Black Friday deals closer to November 26.

28. ProFlowers

If you’re looking to send someone special flowers for the holidays, then go to ProFlowers for some Black Friday deals. If you sign up for emails, you could receive 20% off your order.

29. Sur La Table

Sur La Table is the destination for upscale, professional cookware. They are running their 2021 Black Friday deals, and so far, shoppers can get up to 55% off.

30. ULTA

Purchase everything you need to look and feel beautiful at ULTA during Black Friday and Cyber Monday 2021. In 2020, the store was giving out free gifts with a perfume purchase of $60 or more, plus 50% off on the ULTA Beauty Collection and 50% off fragrance sampler kits.

31. Wine.com

You know you’re going to need to chill out and relax with a nice glass of wine after doing all your Black Friday and Cyber Monday shopping (and hosting the relatives for Thanksgiving). Make sure you check out Wine.com for Cyber Monday deals. New customers can save $20 on a $100 order, and you’ll save 25% or more on November 29. Start shopping for your favorite brand of red or white wines now.

The Takeaway

Black Friday is all about the thrill of a great deal. Survey the stores or items you’re most interested in purchasing to see what the best deals on those specific items are. And while the holidays can be a tempting time to spend freely, setting some guidelines, like a holiday-specific budget could help you keep your spending in line.

With an online bank account with SoFi, you can unlock even more potential earnings and save money at the same time. Plus, you can avoid account fees: SoFi Checking and Savings doesn’t charge any overdraft, minimum balance, or monthly fees. Once your money arrives at our partner banks, it is FDIC insured up to $1.5 million.

To access these benefits and more, make sure you sign up for SoFi Checking and Savings now.

Photo credit: iStock/CarlosDavid.org

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Third-Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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They’re calling it the Great Unretirement. Millions of people who retired in the last decade, and particularly since COVID, are seeking to return to work in the interest of gaining a little more financial security as well as other benefits like connecting with a community and creating a sense of purpose. Fortunately, since the pandemic normalized working from home, there are a lot more remote jobs on the market.

This is important because the AARP noted recently that the opportunity to work from home makes a big difference in retirees’ decision to return to the workplace. Those who previously held jobs where remote work is common may find it easiest to secure jobs post retirement, but there are also options for retirees who didn’t have computer-based jobs. With thorough research and a careful eye, the opportunities are abundant, especially in these key industries.

Education

These days continuous learning, upskilling, and reskilling are absolutely essential to success. As a means to support this need, the online learning industry is booming. It is expected to reach nearly $460 billion
by 2026 . Courses are exploding, covering everything from cooking to meditation, to data science, to creative writing. As a retired senior, you have a lifetime of expertise that you could use to help others grow their skills and help you grow your bank account.

Instructor

Almost anything you’ve mastered can be turned into an online course: woodworking, flying drones, even traveling on the cheap. Whether it’s a hobby or a profession, you might be able to convert it to profit in an online course that students can purchase. Sites like Teachable and Coursera allow would-be teachers to set up an account and create courses that could provide passive income for years.

Consultant

While returning to work is one way to invest in your later years, returning to your field of expertise may net you more money than taking a role that you haven’t yet developed the skills for. If you happen to have years of experience in a field such as business or design, taking on clients as a consultant can be a great way to share your expertise at a premium. Sites like LinkedIn and Indeed can also help, allowing you to search for job opportunities by location, contract status & experience level.

Tutor

If you have the skills to teach but don’t want to do all the back-end work of creating and selling a course, look for jobs tutoring online. Tutors are hired not only by U.S. schools and companies but also by international ones making it highly flexible and potentially highly lucrative.

International English Teacher

The more interconnected the world becomes, the more important it is for people around the world to be able to speak a common language. If you are a native English speaker, or if you speak English really well, you may qualify to teach English to students around the world . For this role, you’ll likely need to get a certificate, but once you are qualified, you can apply for jobs teaching online or even set up your own business.

Customer Service

Another effect of the pandemic is that the world got used to doing its business online, which means that there is a need for people who can support customers online. People often think of customer support jobs as dealing with angry customers. But the reality is that a lot of customer support agents find their jobs very rewarding because they’re solving people’s problems.

Customer Support Agent

Customer support agents work with customers on the phone, through a chat function, on social media, or even through email and generally help customers with things like making returns, processing exchanges and billing problems. Agents must have good communication skills, empathy, solid problem-solving skills, and enough technical aptitude to use the company’s customer support system. Other than that, they generally just need a computer and a headset.

Technical Support Agent

Technical support is similar to customer support except you will be solving customers’ technical issues. For example, the customer doesn’t know how to change their billing address on an app they use, or they can’t figure out how to use the software they bought. You will need some technical know-how, but often companies train employees and provide a knowledge base for them to use to help resolve customer problems.

Travel Agent

For a while, the business of booking people’s travel seemed to have been taken over by sites like Google. But there are still businesses, such as travel companies that work with corporate clients, and medical centers that need to book travel for patients, who hire and train individuals to manage travel booking. Being organized and having good customer service skills is important in this position, and having experience with the type of organization you’re working for can probably help, too.

Administration

Administrative jobs may be some of the best options for seniors working at home. Often these jobs require little experience, but the fact that you’ve been managing your finances, taking care of your own errands and tasks, and otherwise doing the administrative jobs required for life in the 21st century means you’re equipped for these jobs. And if you’re doing them in a specific field where you have expertise, the earnings potential increases.

Virtual Assistant

A virtual assistant tackles all kinds of tasks, from setting appointments to, writing emails, to updating clients’ social media accounts. Virtual assistant jobs are great part time gigs for seniors at home because they only require the skills you already use to manage your own life. If you’re particularly good at management, you can snag lucrative clients and really see your retirement earnings soar.

Bookkeeper

Obviously, such a responsible role requires experience. But with an accounting or business management background you can help small business clients who don’t have the budget for a full-time bookkeeper or a big accounting firm. This could include local restaurants, small shops, or individual medical practitioners.

Tax Preparer

Tax preparers work for firms like H&R Block, who train them before tax season, or independently, serving clients. A lot of tax preparation is formulaic, but to serve clients well, it is key to be familiar with all the rules that change from year to year.

Data Entry Specialist

If you can type quickly and have an eye for detail, data entry may be for you. You can generally land a data entry role without any experience, but if you go for a position in a field where you have expertise — say law, medical records, insurance or consumer packaged goods, the pay is likely to be higher.

Spotting a Scam

As with all things online, there’s always a possibility that something may not be quite what it seems, and that includes online job postings. Remote working opportunities are especially susceptible to fraud because everything is often conducted digitally with no human interaction. As you look for remote opportunities, be cautious of listings that seem too good to be true. Offering a generous amount of money for very little work, or requiring payment before work can begin are red flags. Investigating opportunities thoroughly can help you prevent becoming a victim.

The Takeaway

Opportunities for seniors and retirees to beef up their savings and retirement investments through remote online work are more abundant and varied than ever before. It may be necessary to spend some time searching to best match your interests and skills to the income you want to make and the hours you’re willing to work. And again, it’s important to use discretion when pursuing opportunities to avoid falling victim to a scam.

And when you do find the perfect remote gig to supplement your retirement income, SoFi can help you store those funds. With no account fees and an automatic savings feature, a SoFi Checking and Savings account can help you organize your savings, and get you paid up to two days sooner.

Learn what SoFi Checking and Savings can do for you.

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Third-Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi members with direct deposit can earn up to 1.50% annual percentage yield (APY) interest on all account balances in their Checking and Savings accounts (including Vaults). Members without direct deposit will earn 0.90% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. Rate of 1.50% APY is current as of 06/28/2022. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet
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Both TFSAs and RRSPs are accounts that provide Canadian consumers with a chance to save while enjoying investment earnings and unique tax benefits. While a TFSA acts as a more general savings account, an RRSP is used for retirement savings.

Saving is never a bad idea, so here we’ll help you understand the difference between these accounts and how they can play a role in securing your financial future.

Keep reading for a more detailed breakdown of a TFSA vs. RRSP. We’ll cover:

•   What is a TFSA?

•   What is an RRSP?

•   What are the similarities and differences between these two savings vehicles?

•   How can you choose the one that’s best for you?

What Is the TFSA?

A Tax-Free Savings Account (TFSA) is a type of registered tax-advantaged savings account to help Canadians earn money on their savings — tax-free. TFSA accounts were created in 2009 by the Canadian government to encourage eligible citizens to contribute to this type of savings account.

Essentially, a TFSA holds qualified investments that can generate capital gains, interest, and dividends, and they’re tax-free. These accounts can be used to build an emergency fund, to save for a down payment on a home, or even to finance a dream vacation.

A TFSA can contain the following types of investments:

•   Cash

•   Stocks

•   Bonds

•   Mutual funds

It’s possible to withdraw the contributions and earnings generated from dividends, interest, and capital gains without having to pay any taxes. Accountholders don’t even have to report withdrawals as income when it’s time to file taxes.

There is a limit to how much someone can contribute to a TFSA on an annual basis. This limit is referred to as a contribution limit, and every year the Canadian government determines what the contribution limit for that year is. If someone doesn’t meet the contribution limit one year, their remaining allowed contributions can be made up for in following years.

To contribute to a TFSA, an individual must be at least 18 years of age and be a Canadian resident with a valid Social Insurance Number (SIN).

What Is the RRSP?

A Registered Retirement Savings Plan (RRSP) is, as the name indicates, a type of savings plan specifically designed to help boost retirement savings. To obtain one, a Canadian citizen must register with the Canadian federal government for this financial product and can then start saving.

When someone contributes to an RRSP, their contributions are considered to be tax-advantaged. What this means: The funds they contribute to their RRSP are exempt from being taxed the year they make the contribution (which can reduce the total amount of taxes they need to pay for that year). On top of that, the investment income these contributions generate will grow tax-deferred. This means the account holder won’t pay any taxes on the earnings until they withdraw them.

Unlike a TFSA, there isn’t a minimum age requirement to open and contribute to an RRSP. That being said, certain financial institutions may require their customers to be the age of majority in order to contribute. It’s possible to contribute to an RRSP until the year the account holder turns 71 as long as they are a Canadian resident, earned an income, and filed a tax return.

Keep reading for a TFSA vs. RRSP comparison.

Similarities Between a TFSA and an RRSP

How does a TFSA vs. RRSP compare? There are a few similarities between TFSAs and RRSPs that are worth highlighting. Here are the main ways in which they are the same:

•   Only Canadians citizens can contribute

•   Contributions can help reach savings goals

•   Investments can be held in each account type

•   Both accounts offer tax advantages.

Differences Between a TFSA and RRSP

Next, let’s answer this question: What is the difference between an RRSP and a TFSA? Despite the fact that both an RRSP and a TFSA share similar goals (saving money and earning interest on it) and advantages (tax benefits), they have some key differences to be aware of.

•   Intended use. RRSPs are for retirement savings whereas TFSAs can be used to save for any purpose.

•   Age eligibility. To contribute to a TFSA one must be 18 years old, but there isn’t an age requirement to open an RRSP.

•   Contribution limit. The limits are usually set annually and are different for TFSAs and RRSPs. For 2022, the contribution limit for an RRSP is the lesser of either 18% of earned income reported on an individual’s 2020 tax return or the contribution limit, which was $27,830 in 2021. The limit for a TFSA, which also can vary annually, was most recently $6,000.

•   Taxation on withdrawals. While RRSP withdrawals are taxable (but subject to certain exceptions), TFSA withdrawals can be made at any time tax-free.

•   Taxation on contributions. Contributions made to a TFSA aren’t tax-deductible, but RRSP contributions are.

•   Plan maturity. An RRSP matures at the end of the calendar year that the account holder turns 71. TFSAs don’t have age limits for account maturity.

•   Spousal contributions. There is no form of spousal TFSA available, but someone can contribute to a spousal RRSP.

How Do I Choose Between a TFSA and RRSP?

Choosing between a TFSA and an RRSP depends on someone’s unique savings goals and tax preferences. That being said, if someone’s main goal is saving for retirement, they’ll likely find that an RRSP is the right fit for them. When someone contributes to an RRSP, they can defer paying taxes during their peak earning years. Once they retire and make withdrawals (which they will need to pay taxes on), they will ideally have a lower income (and be in a lower tax bracket) and smaller tax liabilities at that point in their life.

If someone wants to be able to use their savings for a variety of different purposes (perhaps including a medium-term goal like a down payment on a home), they may find that a TFSA offers them more flexibility. That said, there’s no reason TFSA savings can’t be used for retirement later on. Contributing to a TFSA is a great option for someone who has already maxed out their RRSP contributions for the year, but who wants to continue saving and enjoying tax benefits.

Recommended: What Tax Bracket Do I Fall Under?

Can I Have Both a TFSA and RRSP?

It is indeed possible to have both an RRSP and TFSA and to contribute to them at the same time. Putting money into both of these financial vehicles can be a great way to save. There are no downsides associated with contributing to both an RRSP and TFSA at the same time if a person can afford to do so.

Can I Have Multiple RRSP and TFSA Accounts?

Yes, it’s possible to have more than one TFSA and RRSP open at the same time, but there’s no real benefit here. The same contribution limits apply. That means that opening more than one version of the same account or plan only leads to having more accounts to manage and incurring more administration and management fees. Just as you don’t want to pay fees on your checking account and other bank accounts, you probably don’t want to burn through cash on fees here.

Should I Prioritize One Over the Other?

Which type of account someone should prioritize depends on their savings goals. Their preferences regarding the unique tax advantages of each account may also come into play. That being said, if someone is focused on saving for retirement, they’ll likely want to make sure they max out their RRSP contributions first.

The Takeaway

Both RRSP and TFSA accounts are great ways for Canadian citizens to save for financial goals like retiring or financing a wedding. Each account has unique advantages and contribution limits. While an RRSP account is designed to help with stashing away cash for retirement, a TFSA account can be used to save for any type of financial need. Whether you choose one or both of these products, you’ll be on a path towards saving and helping to secure your financial future.

Looking to increase your savings efforts? SoFi can help! Open our linked high yield bank accounts with direct deposit, and you’ll enjoy our no-fee policy and excellent 1.50% APY.

Come see how quickly your money can grow with SoFi.

FAQ

Is it better to invest in TFSA or RRSP?

When it comes to TFSA vs. RRSP, there’s no right answer to whether investing in one is better than the other. Someone focused on saving for retirement may want to prioritize an RRSP, while someone who wants to save for other expenses (like a home or wedding) may find a TFSA more appealing.

Should I max out RRSP or TFSA first?

If someone is focused on saving for retirement, they may want to max out their RRSP first. That being said, this is a personal decision that depends on unique financial goals and tax preferences.

When should you contribute to RRSP vs TFSA?

Typically, the contribution deadline for RRSPs is around March 1st. A Canadian citizen can put funds in a TFSA at any point in a calendar year, and if they don’t max out their account, they will usually be able to contribute the remaining amount in the future.

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Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi members with direct deposit can earn up to 1.50% annual percentage yield (APY) interest on all account balances in their Checking and Savings accounts (including Vaults). Members without direct deposit will earn 0.90% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. Rate of 1.50% APY is current as of 06/28/2022. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Photo credit: iStock/anilakkus
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Many Americans struggle to save money but it’s worth the effort since there are serious downsides to not stashing away cash. These can range from going into debt, facing financial hardship after losing your job, and not being able to achieve your aspirations, like homeownership.

To help you get motivated to put money in the bank, here are twelve dangers of not saving money. They may help you understand why it’s best to put away cash and motivate you to tuck some into a savings account. Not only will you be better prepared for the twists and turns of life, you’ll be better equipped to reach your financial and lifestyle goals.

The Importance of Saving Money

1. Going Into Debt

Without a savings cushion, any expense—from an unexpected car repair to paying for your child’s college education—can put you in debt. In addition, while credit cards and loans are convenient ways to afford more than your bank account, you pay more in the long run because of interest and loan fees.

Since debt often costs more than the actual expense, you can essentially save a considerable amount of money by plumping up your piggy bank.You can try easy ways to save, such as creating a simple budget or automating savings, to put aside a few dollars a month before you can spend it. These moves can ensure that you’ll be using savings instead of debt to pay for your upcoming expenses.

2. Having a Social Life Can Be Nonexistent

Your friends and family are likely on the list of things you enjoy most in life. Being able to afford a dinner out with loved ones can really boost your mood. Heading to a concert with friends can create memories that last a lifetime. But a full social calendar may put you in a sticky financial situation if you haven’t saved anything. From movie dates to happy hours to ball games, these expenses can add up.

No matter your income level, how much money you save each paycheck can make the difference between having a nonexistent social life and a happening one.

3. Life Being More Stressful

According to the Stress in America survey , 65% of respondents say money is a big stressor in their lives, which is the highest percentage since 2015. When you think about it, failing to save can make you feel stuck or overwhelmed. Your personal, financial, and professional life can suffer because a lack of savings has cut off your options.

Achieving your goals, financial and otherwise, may be a struggle without savings to propel you forward. The importance of saving money goes beyond paying an unexpected bill; it can affect your daily quality of life.

4. Not Having the Money for an Emergency

You’ll find many articles, resources, and financial professionals advising you to set aside an emergency fund. Life is expensive and doesn’t always go as planned. So, saving in advance helps you manage life’s unexpected costs.

For example, building an emergency fund might be a better choice than splurging if you get a raise. You’ll thank yourself later when, say, your furnace goes out or you wind up with a major medical bill. Typically, money experts recommend having at least three to six months’ worth of basic expenses salted away in an emergency or rainy day fund.

5. Not Being Able to Celebrate Events

Life is full of amazing milestones like getting married, having a baby, or graduating from college. Unfortunately, celebrating these life events with your family often takes substantial cash. Not being able to recognize these events the way you’d like to is another one of the many dangers of not saving money. The lack of a financial cushion could also lead you to skip, say, a friend’s destination wedding.

Although you could put your celebration on your credit card, you run the risk of going into debt. This will likely cost more over the long run since you have to pay for interest. In other words, you might still be paying it off for years to come.

6. Not Having a Viable Option if You Are Fired

No one plans on getting fired; however, it’s always possible to lose your job unexpectedly. Financial emergencies like this are an important reason to save. Saving can give you security during this kind of a crisis. If you don’t have some cash available, you might have to look into financially downsizing.

This underscores the importance of saving money from your salary when you are employed. You might consider having a small amount automatically transferred from your checking account into savings on payday.

As mentioned above, you should save at least three months of your expenses in an emergency fund. This way, you can have a solid safety net if you get laid off or are temporarily disabled and can’t work for an extended period.

7. Not Having an Inheritance for Your Children

If you’re a parent or plan to be one, you likely want to give your kids a leg up in life. An inheritance can help your children or heirs to build their nest eggs and meet life’s expenses without stress. Having both savings and an estate plan can be a lasting, life-changing gift to those who matter to you most. These assets can serve to eliminate the possibility of financial legal challenges for your family. That said, being unable to leave a legacy is a consequence of not saving money.

8.Not Being Able to Buy a Home

About three-quarters of Americans believe that homeownership is still a core component of the American Dream, according to one recent study . If you don’t save, the dream of homeownership may never become your relativity.

You traditionally need a 20% down payment to qualify for most conventional mortgages. Buying a home also usually involves other expenses, such as closing costs, repairs, moving costs, and more. Not having savings can make it almost impossible to afford the home of your dreams.

9. Not Being Able to Go on Vacation

Without savings, it’s challenging or even sometimes impossible to take time off for some rest. When you don’t set money aside, you can get sucked into the never-ending cycle of living paycheck-to-paycheck. Since you need to work to support yourself, vacations may become less frequent or disappear altogether.

While you may think you can put a vacation on credit, that can perpetuate the “can’t save” situation, because you’ll have debt to wrangle. You could wind up coming home from your getaway to face more bills…ones you may struggle to afford.

10. Not Having Much Financial Freedom

One of the most potent limiting factors in life can be a lack of savings. With a robust bank account to fall back on, you increase your options and flexibility. Moving to a city or state with more opportunity, taking a professional course or college classes, and starting a business can all be possibilities if you’ve saved money.

Of course money can’t solve every problem life throws at you. However, it is a powerful tool that allows you to access opportunities. Remembering this can help you get serious about saving money.

11. Not Being Able to Invest

Investing your money is a superpowered version of saving. For example, if you begin saving $100 at age 25, you will save $12,000 more by age 65 than someone who starts putting $100 away at age 35.

If you save or invest, you can capitalize on compound interest and/or compounding returns. This means your gains are reinvested, so your money can grow faster over time. Consider that an incentive to start saving as early as possible. For example, if you receive a 7% annual rate of return and begin contributing $100 toward saving at age 25, you will amass $120,000 more by age 65 than someone who began contributing at age 35.

If you are Investing your savings vs. keeping them in an insured bank or credit union, you may get higher returns, but this can also mean taking on risk. To balance those forces, educate yourself with an investing guide or seek professional advice.

12. Not Being Able to Help Others

When someone is in financial need, lending money can help them get back on their feet. Whether it’s through providing a micro-loan, donating to a charity, or contributing to a scholarship, you can make a difference in the lives of others no matter how much you give.

But, if you don’t have savings, you may not be able to afford a helping hand.

Why Saving Money Is Very Important

Since money touches almost every area of your life, saving it for what matters most can be essential. Reining in your spending habits can be hard, no doubt, but the payoff quite literally is being able to afford your needs and your goals.

​​Online Banking With SoFi

Affording an enjoyable, stress-free life doesn’t just happen; it requires saving. While this can be difficult in the moment (saying no to splurges, for instance), it can set you up for years of financial wellness. Whether you want to be able to celebrate big moments with friends, start your own business, own a home, or take a major vacation, saving money can help put you on the right path.

Here’s one way to save smarter: with a SoFi bank account. When you use our mobile banking app with direct deposit, you’ll earn a stellar 1.50% APY and pay zero account fees. Those two moves can help your money grow faster.

Bank better with SoFi.

FAQ

Can I get by without saving money?

While it’s possible to get by without savings, there may come a day when you run into an unexpected expense that causes financial hardship. If you live paycheck to paycheck without an emergency fund, an unforeseen cost could set you back and make it challenging to recover.

Is debt inevitable if you do not save?

Without savings to fall back on, it’s quite possible to go into debt when unforeseen expenses arise. Contributing to a savings account, even a small amount monthly, can make unexpected costs more manageable so you can sidestep debt.

When is the best time to start saving?

It’s best to start saving now to give yourself time to build a cushion. Remember, everyone has to start somewhere. Even if you can only save $20 per month, your future self will likely thank you.

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Photo credit: iStock/nicoletaionescu
SoFi members with direct deposit can earn up to 1.50% annual percentage yield (APY) interest on all account balances in their Checking and Savings accounts (including Vaults). Members without direct deposit will earn 0.90% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. Rate of 1.50% APY is current as of 06/28/2022. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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Do you feel like your spending is out of control? It’s a common experience. It can be easy to blow your budget when you succumb to the allure of some shiny new thing (like the latest mobile phone), have an unexpected expense (a car repair, for instance), or say yes to a weekend away with friends when you don’t really have the cash. Whether you’re struggling to stick to a budget or want to be more organized with your money, there’s never a wrong time to get your finances back on track.

Many of us can respond quickly in the one-off, urgent money crisis. It’s akin to going on a crash diet prior to a big event. But if you are regularly feeling strapped for cash and as if you can’t get your money act together, it’s time for a fresh look.

Making permanent lifestyle changes requires time, dedication, and training in new skills. By applying this perspective to budgeting, you’ll be able to diagnose the problems and practice new habits. That can help show you how you can get back on track financially.

Here, you’ll learn:

•   Why it’s so difficult to stick to a budget?

•   Why you typically go off your budget?

•   Ways to stick to a budget.

Why Is It So Hard to Stick to Money Goals?

Even when we create a monthly budget with the best intentions, we might get off track along the way. Life can be expensive! Whether it’s an emergency medical bill or a seemingly irresistible sale, obstacles pop up with regularity for anyone trying to control their finances.

Additionally, establishing new habits is always a challenge. For example, discipline is vital to eat out less or reduce other expenses. It’s easy to slip back into something familiar and comfortable, even if it hurts your wallet.

Remember, too, that everyone is dealing with a pandemic and inflation. The average American household is spending more on necessities like food and fuel. That takes a bite out of your budget. And, as pandemic restrictions lift, many of us want to get back to doing things like going to concerts and traveling. Those can be pricey to begin with, and inflation just intensifies how such expenses can impact your budget.

Recommended: How to Protect Your Money from Inflation

Common Reasons Why People Break Their Budget

Many factors can cause a budget to go sideways. Here are some other common reasons why people break their budgets.

•   An unexpected bill, like a car repair or emergency room bill

•   The budget felt too stringent and was abandoned after one splurge purchase

•   Your income fluctuate too much for a budget to account for, whether that’s because you are a freelance worker or were laid off recently

•   The temptation of a sale, peer pressure, or shopping to satisfy one’s emotions

Tips for Recovering and Getting Back on Track With Your Finances

Even folks who closely track their spending go over their budget now and then. It happens, but diverging from your budget isn’t the main issue — how you recover is more important. So, if you’re wondering how to start getting your finances back on track, these strategies can help speed up the process.

Evaluating and Pinpointing the Damages

You’re not alone if you get to the end of the month wondering where all your money went. When faced with unexpected expenses, most families will experience financial hardship. According to the Federal Reserve, roughly 35% of Americans would struggle to pay $400 in unexpected expenses. That means many of us don’t have emergency funds in place, or at least not adequate ones.

Overspending can mount quickly, putting any budget out of balance. A few additions to the grocery cart, a few extra visits to the coffee shop, or a home repair can wreak havoc on the most carefully planned budget.

For this reason, looking at recent bills and credit card statements can help identify where you spent your money. For example, dinner with your friends at your favorite (and somewhat pricey) restaurant or back-to-school shopping for your children may have thrown off your spending plan. Identifying budget lapses can help you plan for or avoid them in the future.

Adjusting Your Budget Numbers and Goals

Conventional budgeting advises that you look at your expenses at the end of each month. However, reviewing your account balances and statements once a week is more advantageous for keeping track of money coming in and going out. A weekly check-in allows you the time to change course and maintain your budget, even if the first week of the month didn’t do your budget any favors.

You might have zero experience with budgeting, and that’s okay. However, creating a budget for beginners is an excellent way to start working on getting your finances on track. Watching your cash flow can help you tweak your budget to better suit real life.

Being Kind to Yourself

Don’t beat yourself up if you make your budget with the best intentions and fall woefully short the first month. Progress is more realistic than perfection. Moreover, someone trying to build a new skill rarely gets it right the first time.

Cut yourself some slack if you’re months into following a budget and realize you overindulged this week. Your budget is there as a guide, so update it if you see the need and realign your spending the following month. Practice some financial selfcare and get back on track.

Finding a Financial Accountability Partner

Reaching out for help is an effective way to stay disciplined. A financial coach or financial therapist can play a positive role in modifying your spending habits. In addition, spending issues may be rooted in an unhealthy relationship with money. Finding someone who provides accountability and encouragement can be a real support as you learn smarter cash management. It can be the difference between managing your finances successfully and giving up just when you start to get serious.

Even seasoned budgeters can benefit from professional help. Those with budgeting down pat can work with a financial advisor to create a financial plan and achieve their goals, whether that’s building up an even bigger emergency fund or investing for retirement.

Identifying a Budgeting Method for Your Needs

Another strategy to get back on track financially is to pinpoint a budgeting method. There is no one-size-fits-all budgeting solution since everyone has a unique financial situation and personality type. So, here are a few common methods to explore.

•   50/30/20 budget. The 50/30/20 budgeting rule requires budgeters to spend 50% of their income on needs (mortgage, insurance, and car payments), 30% on wants (entertainment, shopping, and personal care items), 20% on savings (investments and emergency fund contributions).

•   Envelope budget. With this method, you divide your spending categories into cash envelopes with a certain amount of cash in each. When the envelope runs out, you can no longer spend in the category until the next month or else you can take money from another envelope.

•   Zero-sum budget. This method requires that you give each dollar you have coming in a job or specific purpose. Therefore, at the end of the month, you will have zero dollars left over.

•   Paying yourself first. With this method, you pay yourself first before you pay other expenses. So, if you plan on saving 20% of your income, you put that away before using the rest of your income as you wish.

•   Line item budget. Usually, when people think of budgeting, a line item budget is the technique that comes to mind. With this method, you place your income and expenses on an Excel spreadsheet to track all the money you have coming in and going out. You learn and adjust as you go.

The Takeaway

If only sticking to a budget were a straightforward and effortless process. But the truth is, many of us lose our focus, have fun spending our hard-earned money, or encounter emergencies and blow our budgets. However, you can get back on track. You may need to diligently track your spending, keep a positive perspective, employ some new strategies, and connect with experts for additional ideas. But by investing some time and energy, you can learn how to get your finances back on track.

A SoFi bank account can help you streamline your budgeting efforts. Not only does our Checking and Savings offer automatic saving features, you’ll also enjoy features that help your money grow faster. For instance, sign up with direct deposit and you’ll enjoy a fantastic 1.50% APY and pay no account fees.

Bank smarter with SoFi today.

FAQ

What is the easiest way to track finances?

Budgeting apps that track your spending can help you understand your finances down to the last detail. For example, you can integrate your credit and debit cards, bank accounts, and investment accounts into one app that provides spending alerts and expense reports.

How can I straighten out my finances?

Some solutions for getting your finances straightened out include making and following a realistic budget, regularly checking your credit reports and scores, and automating transfers to savings and investment accounts. This way, you can begin building good monthly spending habits.

How can I grow financially?

Some strategies for growing your money include using cash instead of credit, avoiding debt, paying bills on time, and eating more meals at home. Look for a financial institution that pays high interest and doesn’t charge fees (it’s likely to be an online bank). Then, apply your savings to investment accounts such as an IRA or employer-sponsored 401(k), which will grow your money over time.

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Photo credit: iStock/Eoneren

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi members with direct deposit can earn up to 1.50% annual percentage yield (APY) interest on all account balances in their Checking and Savings accounts (including Vaults). Members without direct deposit will earn 0.90% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. Rate of 1.50% APY is current as of 06/28/2022. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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