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The less I think about savings, the better.
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Investing should be easy and profitable. If it’s easy, you’ll actually start. If it’s profitable, you’ll actually continue. Some of the best investments you can make in 2023 start with forming simple habits. These habits snowball into savings that compound over time.
1. Automate your savings
Automation makes saving money easy. Consider setting up automatic deposits with your bank account, which will deposit a percentage of each paycheck into your account. That way, you’re not tempted to spend money you’d rather save.
I automatically deposit 10% of my monthly income into my savings account. It’s satisfying to watch the account numbers steadily climb every month. The best savings accounts offer high rates and keep your money safe.
2. Automate your investments
If you’re investing through an IRA, consider setting up auto-deposits. Try to take full advantage of employer matching (or brokerage matching offered by Robinhood IRAs). Think of matching as free money — all you have to do is deposit money into your account.
You can make $150,000 each year in retirement through the magic of compound interest. If you don’t have an IRA, shop for one that fits your needs. The best retirement accounts offer bonus perks and give you reasonable control over your investments.
3. Learn one interesting thing
To paraphrase Warren Buffett, “Knowledge compounds.” Learning is exponential. Progress creeps forward, then snowballs as you make connections between unrelated topics.
Over a year ago, I became interested in how to invest. Things started slow — reading a few articles a day — and quickly escalated when I realized I could combine my two favorite interests: writing and finance. Now, I’m proud to have a career in personal finance.
Consider learning about how money works. Going through life with a vague understanding of your finances is like navigating a snowstorm blindfolded. Money affects everything. Understanding money is key to establishing control over your life.
Tech-savvy folks might find learning through apps the easiest way to go. The best financial literacy apps teach you how to direct where money flows.
4. Start one healthy habit
Happier, healthier, wealthier. That’s the motto of The Motley Fool. Trying to build wealth while in poor health is like climbing Mount Everest while carrying a backpack stuffed with rocks. It’s difficult, and all you can think about is how much your lower back hurts.
Consider starting a healthy habit. Anything will do. To make sure you stick to it, consider the Two-Minute rule suggested by James Clear, author of the bestselling book Atomic Habits. The Two-Minute Rule states that all new habits should take two minutes or less.
My legs often ache from sitting in front of a computer screen. So I’ve started a healthy routine: Whenever I fill up my water glass, I spend one minute doing jump squats. I’m a chronic hydrator, so my legs are on fire by the end of the day. The routine keeps my blood flowing.
Keep things easy and profitable
By keeping investments easy and profitable, you get the most out of the new year. The important thing is to start and be consistent.
A few more things to motivate your investment journey:
Are you a student? Pay off debt with the snowball method.Try to avoid loans. But if you must take one out, choose from among the best personal loans.Consider how much money you should really be saving each month.
Here’s another golden Buffett nugget: “It’s just not necessary to do extraordinary things to get extraordinary results.” It takes a million small stones to build a castle. Take pride in your gains — all of them.
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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Cole Tretheway has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
