Skip to main content

Your ultimate savings guide: Goals and strategies

Allen Wastler

Posted on February 22, 2023

Allen Wastler is a former financial journalist with over 30-years of experience, including time at CNBC, CNN, and Knight-Ridder Newspapers.
two people saving

What lies at the heart of achieving financial wellness and stability? Saving. It’s the practice that leads to stability in day-to-day living, achieving life goals like home ownership or a college education, and securing an adequate retirement.

Yet, many have trouble with saving even for short-term needs, much less retirement. According to the Federal Reserve, about 30 percent of Americans would have trouble covering a sudden $400 expense. And only 42 percent of those approaching retirement age (45-59 years old) think their retirement savings are on track.

So, what’s to be done? For individuals, it becomes a question of deciding:

Here’s a look at each of those steps and how they may possibly fit into your own situation.

What are your savings goals?

No doubt, most people would like to be rich enough not to worry about personal finances or retirement needs. But, short of a major lottery win or fairy tale-level inheritance, such circumstances are out of reach for most people.

The question becomes, then, what do you want to realistically accomplish in terms of savings? This consideration involves both short- and long-term goals.

Shorter-term goals can range from anything like going on a dream vacation to buying a home or paying for a child’s college education. Longer-term goals can range from starting a business to building a strong investment portfolio to securing a comfortable retirement.

Many such goals have financial strategies and savings programs specific to them. It can be advantageous to get familiar with them.

Along with identifying goals comes prioritization. What is important to each saver will depend on individual preference and circumstances. For instance, some people might do away with vacation plans in favor of building funds to start a business. Others, perhaps living in an area where real estate is expensive, might put building an investment portfolio ahead of a home purchase.

Additionally, savings goals should be part of an overall money management strategy that takes into account the demands of debt and income constraints.

For some, setting savings priorities can be relatively easy. For others, the task could present challenges and tough decisions. There are various strategies and tools that can help sort through the choices.

Goals can also change over time. What was important for single adults at one point will likely change if they have children or enter into a relationship or business partnership. That makes it all the more important to know where they stand in terms of their savings.

Where you are

So how do you gauge your progress toward achieving a savings goal?

Obviously, age needs to be taken into account. Younger savers haven’t had much time to build savings, although they stand to gain substantially if they make it a priority.

Older savers are more likely to have built up their accounts over time. But by how much?

There are various rules of thumb — based on multiples of annual income — suggesting where savings levels should be at certain stages of life. Income-based estimates are popular because they assume that most people will be able to live on a similar or slightly lower income in retirement. This makes such guidelines more helpful for most people than absolute dollar figures, which don’t account for regional differences in lifestyle and standards of living.

How to get there

So, once you figure out where you want to be and where you are in your savings plan, the question becomes: How to get there?

Step one is to start a savings account, obviously. But you should also consider taking advantage of any savings programs available to you through an employer or, if a business owner or self-employed, through programs aimed at those circumstances.

These types of programs can help you start down the path of reaching your saving goals.

But, just like a road trip, you need to consider short-term needs as part of the long-term objective. During a long drive, there’s the necessity of gas, food, and rest stops along the way. Similarly, a financial plan needs to take into account the need to cover short-term demands — debt repayment or an emergency expense, for example — while working toward a long-term objective — like a secure retirement or vacation home.

To that end, budgeting and money management are crucial.

A crucial part of setting up financial plans is understanding how some financial tools — like life insurance or disability income insurance — can help act as a safety net. After all, misfortune like illness and death happen and can severely affect a family savings plan. Protection can help prevent that.

Beyond setting up the basics of short-term money management, you need to establish savings practices that will fit your particular situation and help work your way toward the goals you set earlier. For many people, that involves balancing debt repayment obligations with savings.

Catching up

What if your road map indicates you are behind on where you should be in your savings trip?

There are avenues that can help you catch-up or at least make up some of the lost distance.

Additionally, some people may look to other kinds of financial support to bolster their savings efforts.


The concept of saving is a simple one, but for many people it is often difficult to execute. A range of challenges — from student debt loads to day-to-day living expenses to entertainment temptations — can derail the best of intentions.

Identifying your savings goals and measuring where you stand against them are the first steps in tackling the challenge. With those two data points in hand, you can establish an overall savings plan that, with some effort and a little bit of discipline, can help you get where you want to be.

Discover more from MassMutual…

Retiring early? Ways to tap savings but sidestep penalties

5 financial lessons from 2020

6 steps to better personal finance


Need a financial professional? Let us know ...

* = required

By submitting this request, I agree to receive e-mails and phone calls using automated technology from MassMutual, its financial professionals, affiliates or vendors on its behalf regarding MassMutual products and services, at the e-mail address and phone number(s) above, even if it is for a wireless phone. I understand I can contact a local financial professional directly to make a purchase without consenting to receive calls from MassMutual.

The information provided is not written or intended as specific tax or legal advice. MassMutual, its employees and representatives are not authorized to give tax or legal advice. You are encouraged to seek advice from your own tax or legal counsel. Opinions expressed by those interviewed are their own and do not necessarily represent the views of Massachusetts Mutual Life Insurance Company.