Simple Ways to Build Your Nest Egg


You know that saving for the future is important; but if you had to answer honestly, would you be able to say that you are giving your nest egg the attention that it deserves?

You don’t have to be a financial wizard to begin building your nest egg. Whether you’re just getting started, or are looking to grow the savings that you’ve already accumulated, the following simple suggestions will help stay on the right track.

  • Start by planning. When you think about how much money you’re really going to need to meet all of your future obligations—sending your children to college, securing your retirement income, buying a new home—the task of actually planning your savings strategy may seem overwhelming.The best way to start is by setting long-term savings goals, because they will be ongoing, and you will need to work on them a little bit at a time. Once you have calculated how much you’ll need to set aside each month to meet long-term goals, you should next establish intermediate- and short-term goals. Continue to follow your savings plan, even after you have reached your short-term targets.
  • Prioritize your long-term needs. How will you pay for major expenses—with savings or debt financing? Keep in mind, not all debt is bad. For example, if you can’t afford to save for both college and retirement, you may be better off borrowing to pay for college and saving for post-retirement living expenses.After all, nobody is going to offer you a scholarship for retirement. Careful planning can help you decide how best to meet all of your needs.
  • Pay yourself first. If it’s not already a part of your regular routine, make saving a habit, just like paying your bills. To make it automatic and as painless as possible, arrange to have a portion of your paycheck (even if it’s just a small amount) directly deposited into a savings or investment account. As time goes on, increase the portion that’s siphoned off for savings.
  • Control and reduce your debt. Although some forms of debt are manageable, there are others that can do serious damage to your savings plan. Every dollar that you spend on credit card interest fees is a dollar that you could be putting to more productive use in a savings or investment account.
  • Team up. Work with your spouse, parents or significant other to outline your financial goals. Talking about your goals with another person may provide the support and incentive that you need to stay on track with your savings plan.If you are married, it’s especially important to communicate with your spouse to set mutually agreeable goals and develop strategies to achieve them. Enlist the aid of a financial professional, who can provide expert assistance in tailoring a savings plan to your specific needs.

About the Author

Lorraine Schultz, AAMS®, RPC, is an Accredited Asset Management Specialist and Retirement Planning and Financial Advisor with A.G. Edwards a division of Wachovia Securities, LLC.  Contact her at 708-361-1229. This article was provided by A.G. Edwards a division of Wachovia Securities LLC. Member SIPC.

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