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How to Save Money Automatically

Written by:
Director of Education and Corporate Communications
how to save money automatically; hand holding smartphone with money symbols around it

Saving money used to take time and thought—flipping through circulars, clipping coupons, and mailing in rebates. Even moving money to your savings account took at least some effort. But technology has changed all that. There are now plenty of tools and online banking tricks you can use to save money automatically. Here are our five favorites.

3 ways to use automatic transfers and account debits to save

1. Split your paychecks

When you start a job, you often set up direct deposit to your main checking account. But this isn’t your only option.

You can also split percentages of your paycheck among multiple accounts. This makes it easy to save a set percentage each month because that amount simply never enters your checking account.

If you’re already employed, many online human resources systems have a way for employees to redirect part of their paychecks to a different bank account. Check your online portal or speak with the HR department directly.

When choosing a percentage of your paycheck to redirect, make sure it’s a reasonable, sustainable amount. Experts usually suggest saving 10-20 percent of your monthly income. But if you can’t do that comfortably without stressing your budget, start small and work your way up.

5. Set up recurring transfers to a savings account

If you don’t want to split your paycheck, you can also set up a recurring transfer between your bank accounts. You can do this through your bank’s online portal. Instructions will vary depending on who you bank with.

Usually, this can’t automatically be set as a percentage of your paycheck. You need to pick a set dollar amount to transfer from your checking account to a savings account each month.

You can start with something simple like $100 or $200 per month. Or, you can calculate a percentage of your paychecks on your own and use that amount.

Like splitting up your paycheck, this ensures that your money goes straight to your savings account before you ever have the chance to spend it.

3. Set up direct debit payments to a retirement account

If you have a 401(k) account through your employer, then some of your income is already deposited into that account each pay period. However, you can also use an IRA or Roth IRA to save even more for your retirement.

Open an IRA with your preferred financial servicer. Then, set up an automatic monthly transfer from your checking account to your IRA. This process will be different for every servicer, so call their customer service if you need help.

2 ways to save money automatically every day

4. Use web browser extensions to save money online

Web browsers are the platforms that you use to surf the internet, such as Chrome, Edge, Safari, or Firefox. All of these browsers give you the ability to add extensions or plugins that stay active while you are online.

Extensions like Honey and Shoptagr scour the web for coupon codes when you’re shopping online. When you get to the checkout page of the site, the extensions can test various codes to ensure you’re getting the best deal.

Especially if you frequently shop online, installing one (or more) of these extensions on your browser can save you money on many purchases. You can also use extensions like Ibotta or Rakuten to find cash-back rebates.

5. Try spare change apps

Qapital, and Tip Yourself are just a few of the many apps that enable you to save by automatically tucking away spare change from your transactions. You can use these smartphone applications to “round up” your purchases and save the difference.

For example, say you buy lunch for $10.14. The app can “round up” your purchase to $11, and the 86-cent difference will be saved in an account on the app.

These small amounts add up. Every transaction you make can lead to more savings. In some of these apps, you can even deposit this change directly into an investing account.

In conclusion…

Saving is easier than you think. Use one or multiple of these strategies to start making saving automatic, cut down on stress, and financially prepare for your future.