How To Set Savings Goals: 6 Tips

One of the basics of building a strong financial foundation is saving money. If you find yourself struggling to put money away every month, one strategy that may help is creating savings goals. Defining what you’re saving for and consistently working toward your goals will help you achieve success.

Why are savings goals important?

Saving is one of the most vital ways to achieve financial freedom. Whether you’re stashing money away for an emergency or saving up for a large expense, savings goals can mean avoiding borrowing money and paying expensive interest charges. The less you borrow and the more you can rely on your own savings, the more financially free you are.

Here’s how to set and hit your savings goals.

1. Choose a specific savings goal

First, define your goal. Whether it’s a vacation, a college education, a down payment on a house or retirement, decide what you’re working toward rather than choosing a nebulous number or a vague idea of saving more money.

Your first savings goal should be an emergency savings fund. Aim to have three to six months of your expenses saved. This varies for everyone, so crunch some numbers to see how much you need to save. It can feel daunting when you see the final number, so try setting smaller goals first. For instance, if you need to save $15,000 as your final goal, try making your first goal $500 or $1,000. Being realistic and specific can help you reach your goal. 

You can try different budgeting methods to reach your savings goal, whether it’s the zero-based budgeting approach or the 50/30/20 method. Not every budgeting option works best for everyone, so if you feel like one approach isn’t working for you, don’t be afraid to pivot and try something else. 

2. Set a savings deadline

Next, set a timeline for accomplishing your goal. Some goals, like buying a car next year, might be shorter term. Other goals, like reaching your retirement number, might take longer and require more ongoing planning.

“Setting yourself up for success means a plan and a schedule,” says Ari Baum, CFP, founder and CEO of Endurance Wealth Partners. “Figure out your monthly or weekly contributions to reach your goals.”

For regular savings, use a savings goal calculator to see how much you’ll need to set aside in a savings account to meet your goals. For example, if you know you need to save $6,000 in one year, your high-yield savings account pays 4 percent APY and you’re starting with just $1, you’ll need to contribute $490.79 dollars a month to meet your goal. 

If you’re on a tight budget, determine how much you can afford to save each month and then use a regular savings calculator to determine when you’ll be able to meet your goal. 

For retirement, you can use an investment calculator to estimate how much you need to invest to hit your retirement savings goals.

And don’t forget to keep your emergency fund in a high-yield savings account. The interest you’ll earn will help you meet your savings goals faster than a traditional savings account.

3. Create a different account for each goal

Baum also recommends setting up different savings accounts for each goal if you’re saving for more than one goal at a time. You can also find a savings account that lets you separate different sections, or buckets, in one savings account to name different goals. That way, you can decide how to divide your resources into the accounts based on your savings timeline and the amount you need to reach your goals.

In some cases, you might have to prioritize some goals over others. If you need a new car, you might need to prioritize that savings goal over putting more money toward a vacation. Think critically about where your money needs to go first and work from there.

The FDIC insures up to $250,000 per depositor, per FDIC-insured bank, per ownership category. For big savers, having accounts at multiple banks can help keep your money safe.

4. Track your goals

Keep track of your progress for each goal by taking a look at your accounts at the end of every month to confirm you’ve saved the amount you planned. Make adjustments as needed to ensure the amount you wish to set aside for each goal is realistic. See if there are places in your budget — such as entertainment or dining out — where you can trim spending to meet your savings goals.

One way you can track your progress is by using a spreadsheet. It can be part of a monthly budget in which you create spending categories for rent/mortgage, utilities, groceries, entertainment and so on. Also include categories for saving for each of your goals.

If manually tracking your savings for each goal sounds complicated or time consuming, consider automating the process with a budgeting app. “Once you get the ball rolling, saving money can become addictive,” Baum says. “It’s fun to watch your savings pile up as you make contributions over time.”

5. Break your goals down into smaller chunks

Rooted Planning Group’s Irvine recommends breaking down your goals into smaller chunks so that you can feel more empowered to reach your goals.

For example, if you want to take a vacation for $5,000 in 12 months, you’d need to set aside around $416 each month. If coming up with that amount feels daunting, try thinking of it in weekly terms instead, which breaks down to $104 per week and see if that feels more manageable. If you won’t be able to hit this target, look for ways to cut back on your spending.

“Identify where and how you’re spending money in a way that isn’t serving you,” Irvine says. “With that knowledge, you can take different actions to find the money you need to meet your goal.”

Whether or not you choose to break larger goals down into smaller, more manageable ones, having a financial plan and goals can be good for one’s confidence. A Charles Schwab Modern Wealth Survey found that 96 percent of those who have a written financial plan felt “very confident” they would reach their financial goals.

6. Automate your goals

Rather than trying to remember to set aside money for a goal, consider using automatic transfers and deductions. You can create automatic transfers from a checking account to a savings account to occur on the same day each week or month.

Brian Walsh, Jr., co-founder of Walsh & Nicholson Financial Group, says that automatically moving the money helps it stay out of sight so you don’t spend it. He also recommends using an investment account when it makes sense for your situation. “Set up an investment account, whether it be a Roth IRA, IRA or brokerage account, and have a set dollar amount going into that account each paycheck,” he says. “You can set up your bank account to automatically transfer to the investment account.”

It’s important to remember that you have automatic transfers set up, and for which accounts, so you don’t end up over- or under-saving for your goals.

Savings goal statistics

• Americans’ top financial goals for 2025 included paying down debt (21 percent), saving more for emergencies (12 percent) and getting a higher-paying job or an additional source of income (11 percent) according to Bankrate’s Financial Outlook Survey.
• Less than half of people (41 percent) say they would be able to pay for an unexpected $1,000 expense from their savings per Bankrate’s 2025 Emergency Savings Report.
• Less than one-third of U.S. adults — 27 percent — have no emergency savings at all, as of May 2024 polling, according to Bankrate’s Emergency Savings Report.

What should I do if I fall behind on my savings goal?

Think of saving for a goal like a marathon, not a sprint. At times, you may need your money for other things, especially for an unexpected expense. That can put your savings goals on the backburner. 

It’s normal for things to come up, but don’t feel discouraged. Readjust your goals and deadlines as necessary. Sometimes falling behind is a sign that you need to take a fresh look at your goals to make sure they’re working for you. 

Bottom line

Setting up savings goals is a way to help ensure you’ll have the money for emergencies, as well as things you need and want. After defining what you’re saving for and working out a realistic timeline, it’s important to track your progress every month. This can be part of a regular budgeting process, whether you’re using pen and paper, a spreadsheet or a handy budgeting app.

Ultimately, having defined savings goals can help you save money more quickly and afford the things you want while staying financially healthy and keeping out of debt.