Skip Header
U.S. flag

An official website of the United States government

FDIC Consumer News

Starting Small Can Lead to Big Savings

Vea esta página en español

January 2024

Last Updated: January 05, 2024
Growing trees on top of coins in three glass bottles with a nature background Growing trees on top of coins in three glass bottles with a nature background
consumer news banner

Starting Small Can Lead to Big Savings

Meet your savings goals with these strategies

Do you have accumulated debt, perhaps from student loans, credit cards or car loans? Do you want to set aside savings for future needs? There are simple strategies for gradually building small savings into large sums. Here are some ways to help you begin to save or build up your savings.

Save for specific goals

You should have a savings plan for future expenses that you anticipate — perhaps education costs, a home or car purchase, starting a small business, or preparing for retirement (whether that may be a few years or several decades away).

Also, consider setting a goal to build up an “emergency” fund that would cover at least six months of living expenses to help get through a difficult time, such as a job loss, major car repairs, or unexpected medical expenses not covered by insurance.

Commit to saving money regularly

If specific goals seems out of reach for you, any amount you can put in savings will help provide a cushion against future financial hard times or big purchases. This is important for everyone, but especially if you are supporting yourself financially. Even if you do not make a big salary or have a steady source of income, the combination of consistently adding to savings and the compounding of interest can bring dramatic results over time.

Aim to save a minimum percentage of your paycheck and over time, try to increase the amount you put aside as you pay down other debts. Putting aside a set amount on an ongoing basis is known as “paying yourself first,” because you are saving before you are tempted to spend. If you cannot afford to save a specific percent of your earnings, begin with any amount you can afford, no matter how small. Once you see that you can manage your expenses while also saving, try to increase the amount you contribute to your savings at every opportunity.

Put your savings on autopilot

Make saving money quick and easy by having your employer direct-deposit part or all of your paycheck into an FDIC-insured savings account. Your employer or your financial institution may be able to set this up for you. As you pay off debt, switch to making those monthly “payments” to yourself.

Make use of tax-advantaged retirement accounts and matching funds

Look into your retirement savings options at work, which may come with matching contributions from your employer. It is possible that allocating part of your paycheck to your retirement account will not reduce your take-home pay significantly, particularly when you consider what you may save in income taxes. In addition, the sooner you start saving money in a retirement account, the more you can take advantage of compound interest. If you have contributed the maximum at work or if your employer does not have a retirement savings program, consider establishing your own IRA (Individual Retirement Account) with a financial institution and make regular transfers into it. Remember that you can set up an automatic transfer from a checking account into a regular savings account or an IRA savings account (or both).

Separating savings for certain purposes

Consider keeping emergency savings in a separate FDIC-insured savings account instead of a checking account, so that you can better resist the urge to raid the funds for everyday expenses. Be sure to develop a plan to replenish any withdrawals from your emergency fund. For large purchases that you hope to make years from now, consider certificates of deposit or U.S. Savings Bonds. These generally earn more interest than a basic savings account, because you agree to keep the funds untouched for a period of time.

For future college expenses, look into 529 plans, which provide an easy way to save for college expenses and may offer tax benefits.

For healthcare expenses, find out whether you are eligible for a “health savings account,” a tax-advantaged way for people enrolled in high-deductible health insurance plans to save for medical expenses.

Think about ways to cut your expenses

For your financial services, research lower-cost checking accounts at your bank and some competitors. More broadly, look at your monthly expenses for everything from food to phones and think about ways to save. If you are spending more than your means, read an earlier FDIC Consumer News article “Time to Take a New Look at Your Money Habits.”

Even if you find yourself with very little savings for immediate needs, starting small can move you toward your savings goals. These simple strategies can help you gradually build your savings into large sums.

Additional resources:

FDIC How Money Smart Are You? Your Savings

America Saves Week

Financial Literacy and Education Commission, My Money Five

Securities & Exchange Commission (SEC), Save & Invest

SEC, Guide to Savings and Investing

For more consumer resources, visit, or go to the FDIC Knowledge Center. You can also call the FDIC toll-free at 1-877-ASK-FDIC (1-877-275-3342). Please send your story ideas or comments to You can subscribe to this and other free FDIC publications to keep informed!

FDIC Logo for Print