<p>Building a financial cushion can not only help you stay afloat if emergency costs come up (say, a major home repair or a medical issue for you or your pet) but it can also position you to achieve milestones, such as taking a family vacation or buying a new home.</p>
<p>But staying motivated to save can be challenging; in fact, according to the Federal Reserve, 37% of adults said they'd have to borrow money, sell items or be unable to cover a $400 unexpected expense. Here are some financial planning strategies that can keep you on track.</p>
<h2>Think small, at first</h2>
<p>Scientists have found that breaking up vast goals into smaller, more granular ones improves your odds of achieving them. Why? According to a study published in Scientific American, &ldquo;sub-goals&rdquo; may be less intimidating and provide a more frequent sense of achievement.</p>
<p>Here&rsquo;s how this can work. Say you need to save $6,000 in six months. You would divide that goal into sub-goals of setting aside $1,000 per month or $250 per week, which can feel more attainable. Keeping these funds in a separate savings account named for your specific goal, such as "emergency fund," can make it easier to track your progress and, as a result, stay committed. "Failure breeds failure and success breeds success," says professional organizer Andrew Mellen, founder of andrewmellen.com. "As you see the balances go up, hopefully there's some motivation and enthusiasm there."</p>
<h2><img src="https://www.lifeandmoney.citi.com/rcs/v1/media/lifeandmoney/akpublic/storage/retrieveMediaFile/6627c6f7a5a60d6509751495" alt="Couple planning their home budget.">Pre-plan some payoffs&nbsp;</h2>
<p>It&rsquo;s common to set a goal and start strong but then become sidetracked. One fix for this is to set a strategy of attaching a reward to small wins. Giving yourself some kind of treat for hitting savings amounts (like lunch with a friend or a new movie download) adds structure and a sense of achievement &ndash; and the practice can also keep you from feeling deprived. &ldquo;Little treats help you stay motivated and working toward a goal,&rdquo; says Catherine Valega, a certified financial planner (CFP) and founder of Green Bee Advisory, &ldquo;so I'm a big believer in having rewards built in.&rdquo;</p>
<h2>Make it (sort of) mindless</h2>
<p>Saving money takes a certain amount of thought and discipline &ndash; unless you automate it with a feature like Citi's Set &amp; Save<a href="https://online.citi.com/US/ag/dashboard?extension=savingGoals" target="_blank" rel="noopener" data-link-source="tiny">,</a> available to Citi&rsquo;s savings customers. The service lets you set up a scheduled transfer from your checking account to your savings account (in the amount and frequency you choose), so it can be a simple way to build up your reserve. In general, says Mellen, "If you have to manually make the decision every month to save money, there are plenty of opportunities for you to have a conversation [with yourself], like 'well, maybe not this month&rsquo; or 'I'll get caught up next month,&rsquo; whereas when you automate it, you don't have to think about it."</p>
<p>Research backs this up. Recently the Consumer Financial Protection Bureau released a study that found those who set up automated savings rules, such as automated transfers every week or every payday, increased their odds of reaching saving milestones and their total average balance. On average, people saved $167.84 per month &mdash; more than double the total balance of those who didn't use automatic transfers.</p>
<p>It&rsquo;s worth looking into the saving programs your financial institution provides. For example, Citi offers these three:</p>
<ul>
<li style="list-style: none;">
<ul>
<li><a href="https://online.citi.com/US/ag/dashboard?extension=savingGoals" target="_blank" rel="noopener" data-link-source="tiny"><strong>Spend &amp; Save</strong></a><strong>:</strong><strong> </strong>When you activate this feature, amounts from purchases made with a designated Citi debit or credit card will be rounded up to the next whole dollar amount, and the difference will be added to your savings round-up tally periodically transferred from your Citi checking account to your Citi savings account.</li>
<li><a href="https://online.citi.com/US/ag/dashboard?extension=savingGoals" target="_blank" rel="noopener" data-link-source="tiny"><strong>Earn &amp; Save</strong></a><strong>:</strong><strong> </strong>This program sets aside a portion of your deposits, and you can save more as your pay increases.</li>
<li><a href="https://www.citi.com/credit-cards/citishop/home" target="_blank" rel="noopener" data-link-source="tiny"><strong>Citi Shop</strong>℠</a><strong>:</strong><strong> </strong>Available on desktop and mobile, the Citi Shop browser extension automatically searches for offers and coupons at over 5,000 online merchants. &nbsp;</li>
</ul>
</li>
</ul>
<h2>Give yourself visual prompts</h2>
<p>Picturing your goals can be a powerful motivator. If you&rsquo;re saving for a down payment on a home, for example, envisioning what that house might look like or what it would feel like to decorate the space can make you more inclined to continuously set aside funds.</p>
<p>You could also use actual photos of the goals (say, a new car or vacation destination). Keep them in your wallet, near your laptop or in other spots connected to spending habits; seeing it might prompt you to rethink unnecessary purchases.</p>
<h2>Find a sounding board</h2>
<p>Money is often a taboo topic, but it can help to talk about your savings goals with a trusted friend or family member. If you&rsquo;re comfortable, you might consider asking if you can give them regular updates on how it&rsquo;s going, which can keep you accountable and help you come up with ideas to be more successful at saving.</p>
<p>Alternatively, you could work with a personal banker or financial advisor who can regularly give feedback on your progress and offer suggestions to build on it. A qualified advisor can identify ways to maximize your savings, for example, by taking advantage of programs through your employer such as a 401(k) retirement plan, student loan repayment assistance programs and healthcare savings accounts (HSAs).</p>

One way to turn your financial goals into reality is to commit to consistently saving. This money management advice from experts can help you keep at it.

5 Pro Tips to Stick to Your Savings Plan

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<p>Interest rates may still be considered high, but you can still find plenty of opportunity in the current real estate market, especially if you&rsquo;ve prepped your finances first. Typically, this includes improving your credit score, paying down debts and bolstering savings. It may seem like a tall order, but it's worthwhile because underwriters consider each of these components when reviewing your loan application. Putting forth the strongest financial package possible will increase your chances of getting approved for a home loan and can also help secure the best possible interest rate, which can save you money over the life of the loan.</p>
<p>To help you get your finances in shape and navigate the current market conditions, we asked industry pros for their best advice on becoming a more competitive buyer.</p>
<p><img class="right_image" src="https://www.lifeandmoney.citi.com/rcs/lifeandmoney/storage/public/LAM_CompetitiveHomebuyer_BodyImage_1000x667_B_1.jpg" alt="A couple signs a document with a real estate agent"></p>
<h2>Work on your credit score</h2>
<p>The surest way to improve a credit score is to make payments on time and <a href="https://www.lifeandmoney.citi.com/lam/articles/money/managing-money/how-to-pay-off-debt" data-link-source="tiny">pay down debt</a> as much as possible. This process takes time, and while there's no immediate way to boost your score, you can try to expedite the process by checking your credit reports for any errors that can be resolved. You may also want to consider asking a friend or family member with good credit if you can become an authorized user on one of their cards. Doing so may raise your available credit and drop your utilization ratio, which is a major factor in determining your overall credit score.</p>
<h2>Build up savings</h2>
<p>You'll need accessible funds for a down payment and closing costs, but having reserves (your cash assets left over after covering those expenses) is important too; typically, lenders expect buyers to have three to six months' worth of mortgage payments in the bank for reserves after closing.</p>
<h2>Consider your debt-to-income ratio (DTI)</h2>
<p>This is a measure of your total recurring debt divided by your gross monthly income. A good goal is for this ratio to be below 45% because that is the number most lenders look for when reviewing loan applications. If your current ratio is over that benchmark, you can improve it by either paying down debt or increasing your monthly take-home pay.</p>
<p>Your best bet is to connect with a home lending officer three to six months before you're ready to buy, says Zachary Rose, a Citi home lending officer in Laguna Niguel, CA. That way, "you can start having a conversation with them about your down payment, FICO score, DTI, and reserves &mdash; all the small details that can throw a wrench in the approval process," he says, instead of having to scramble.</p>
<h2>Get pre-approved for a mortgage</h2>
<p>Getting <a href="https://www.lifeandmoney.citi.com/lam/articles/milestones/home-buying/how-to-get-a-mortgage-pre-approval" data-link-source="tiny">pre-approved for a mortgage</a> is always beneficial because it provides proof that you can afford to buy the seller's property, assuring them your offer is legitimate. It's a must particularly in competitive markets because if you're not pre-approved, other buyers who can provide this reassurance can swoop in and win out. In fact, "a lot of listing agents won't even look at an offer unless it comes with a pre-approval attached," says Rose.</p>
<p>Keep in mind: Most pre-approvals don't come with a lending commitment; they give a rough estimate of what the buyer can afford. Because the final lending decision comes later, after further review, this type of pre-approval can be riskier for both the buyer and seller because the loan application could eventually be denied.</p>
<p>If you're looking for added security, consider an option like the Citi SureStart&reg; Pre-Approval program, which offers a firm loan commitment for approved borrowers. This makes your offer stronger "because you've taken the main hurdle out of the process," says Rose.</p>
<p><img class="right_image" src="https://www.lifeandmoney.citi.com/rcs/lifeandmoney/storage/public/LAM_CompetitiveHomebuyer_BodyImage_1000x667_A_0.jpg" alt="A real estate agent shows an apartment to a couple"></p>
<h2>Work with an experienced local agent</h2>
<p>The pro you choose can directly impact your home buying success, especially in a fluctuating market, so you'll want to find a knowledgeable agent who is responsive and available to answer your questions and is a proven negotiator. Because it's less of a seller's market right now, says Rose, "hiring someone who has the skills to negotiate on price and concessions can be a really big advantage in this environment."</p>
<p>Research options online and ask friends and family for their recommendations, with an emphasis on finding an agent familiar with your area. "Real estate markets are very local, so what's happening nationally may or may not apply," says Stanley D. Longhofer, Ph.D., director of the WSU Center for Real Estate at Wichita State University in Kansas.</p>
<p>"An agent who can help you understand what's going on in your local market is essential," he says. "I can't emphasize the value of that enough. They've seen the types of offers sellers are receiving and they know what types of terms you may need to put to create a competitive offer."</p>
<h2>Structure a strong offer</h2>
<p>The amount of your offer is important, of course, but there are also other components you can include to make your bid even more attractive to the seller. To start, you can increase the amount you put in escrow, or your good faith deposit on the home. The typical escrow amount is 3% of the home's purchase price, according to NAR, but upping that percentage can show the seller you are serious about buying, says Dr. Longhofer. "Just be sure this is an amount you can afford to lose because, ultimately, if you decide to break the contract and walk away from the home, there's a chance you won't get this money back," he says.</p>
<p>If you can afford it, consider covering the closing costs or absorbing repair costs, if any, too. While you won't want to waive an inspection entirely &mdash; it's the only way to get a true picture of the home's condition and the opportunity to walk away if it needs too much work &mdash; agreeing to pay a set dollar amount toward repairs can sweeten the deal, Dr. Longhofer says.</p>
<p>Finally, if you're not set on a particular time frame, consider accommodating the seller's requests on the closing and possession dates. Details like these can be the concessions that give you the winning edge.</p>

How to Be a More Competitive Homebuyer Right Now

<p>From your Social Security number to your cellphone digits, all kinds of numbers play a role in life. But arguably one of the most important is your credit score --the three-digit number that tells creditors how likely you are to repay your debt -- in large part because it can impact your car insurance premiums, whether you get hired for a job and more. Boosting this score may seem like a daunting task, but it doesn&rsquo;t have to be. These tips can help you give yours a lift.</p>
<p>Good credit &ldquo;opens up doors,&rdquo; says Girish Govind, head of credit risk decision modeling at Citi, and not just figuratively but also literally: If you want to rent an apartment, the landlord may look at your credit score, he says. The same goes &ldquo;if you&rsquo;re trying to get a good insurance rate.&rdquo;</p>
<p>At the same time, despite their significance, credit scores are low for many Americans. According to Experian's 2023 Consumer Credit Review, of those who have one, 33% have a score in the poor to fair range of 300 to 669. What&rsquo;s more, the Federal Deposit Insurance Corporation (FDIC) reports that an additional 28 million people are credit invisible, meaning their credit history is so limited they don't have any credit score at all.</p>
<p>Fortunately, there are simple ways to help rebuild or establish credit &nbsp;Read on for eight strategies to consider.</p>
<h2>Open a store or gas card</h2>
<p>If you haven't taken out a loan or opened a credit card before, it can be difficult to qualify for most forms of credit. Retail cards, though, may be easier to qualify for than traditional cards, and they don't require a security deposit, so they can be a good option for establishing credit. You can apply for a card with most chains and retailers. If you&rsquo;re approved, and if you make your payments on time and keep your balance low, you can build your credit with a positive payment history and low credit utilization.</p>
<p>As with other types, of course, you&rsquo;ll need to use it responsibly in order for it to benefit your credit. "Don't go and buy a whole bunch of stuff," cautions Todd Christensen, an education manager with Money Fit at Debt Reduction Services, a nonprofit credit counseling agency. "Just buy something you were going to buy anyway and pay off the purchase as soon as possible once you&rsquo;re billed.</p>
<p><img src="https://www.lifeandmoney.citi.com/rcs/v1/media/lifeandmoney/akpublic/storage/retrieveMediaFile/6581cd15d65f0570b519dfd6" alt="improve-your-credit_body-1_1134562274.jpg/" /></p>
<h2>Apply for a secured credit card</h2>
<p>Here&rsquo;s another helpful tool for anyone who has no credit history or has had credit problems in the past. A secured credit card requires a deposit, unlike traditional credit cards, which give you a credit limit based on your deposit. The deposit is typically between $200 and $1,000. You can charge only up to the available credit limit and it&rsquo;s important to make timely payments as well as pay at least the required minimum amount due.</p>
<p>When you use this card and then make payments, the card issuer reports the activity to the credit bureaus. Even if you use it only for small transactions (say, a streaming subscription or a convenience-store item once a month), it may still have a significant impact on your credit score. If you didn't have enough of a credit history to generate a credit score before, a secured card may provide enough information to give you a valid score in just six months. &nbsp;</p>
<h2>Regularly review your credit reports</h2>
<p>As you start building credit, scanning your credit reports at least once a year can be useful. &ldquo;A lot of people have errors on their credit bureau reports,&rdquo; says Govind &ndash; one-third of adults, in fact, according to a 2021 Consumer Reports study &mdash; and because these can lower your score, &ldquo;it's important to check and see if all the accounts are yours, or if there are any inaccurate missed payments or outdated information."</p>
<p>You can view each of your credit reports from the three credit bureaus (Equifax, Experian and TransUnion) at <a href="https://www.annualcreditreport.com/index.action" target="_blank" rel="noopener" data-link-source="tiny">AnnualCreditReport.com</a> for free. If you do spot any errors, such as accounts you didn't open or clerical mistakes, you can dispute those charges online with the credit bureaus.</p>
<p>You can also protect against fraudsters by freezing your credit with all three bureaus. This can be a smart move because it helps prevent creditors from accessing your credit file. If someone steals your identity and applies for a loan or credit card in your name, the creditor won't be able to perform a credit check, and the application will be denied.</p>
<p>A credit freeze &ldquo;is free, and you can unfreeze it anytime,&rdquo; Christensen says. "Unless you are applying for a line of credit, there's no need for it to be open.&rdquo; And if you do want to apply for new credit at any point, you can remove the freeze through the credit bureaus' websites.</p>
<h2>Keep older cards active (even if you don&rsquo;t really need them)</h2>
<p>As your credit improves, you may qualify for other credit cards with better rates or benefits, such as those that offer cash back rewards or airline miles, so you may want to add one or more that work for your spending habits. But that doesn&rsquo;t mean you should close your older card.</p>
<p>Keeping a credit card open helps with the length of your credit history as well as your utilization, explains Jenelle Dito, senior director with FICO Scores, the most commonly used credit scoring model.&nbsp; When you close an account, that credit limit no longer appears on your credit report. You then have less available credit to use, so your credit utilization &mdash; the amount of your available credit you use &mdash; increases. And because credit utilization determines about 30% of your credit score, the impact of closing an old credit card may be significant.</p>
<p>However, "If you're just too tempted to use [the credit card] and are not going to use it responsibly, then closing it may be a long-term benefit," says Dito. Otherwise, leaving the card open and using it only occasionally to keep it active may &nbsp;have a better effect on your credit.</p>
<h2>Maintain a healthy mix of credit</h2>
<p>Generally, creditors like to see that you can handle multiple forms of debt, such as a combination of installment loans, revolving credit &mdash; credit you can use again and again, such as a credit card &mdash; or mortgage debt. "[Credit mix] is only 10% of the calculation of a FICO Score," says Dito &ndash; it essentially acknowledges that people with a healthy mix of types of credit tend to manage their credit in a more responsible way &mdash; "but gradually adding different types of credit as you need it can give your score a modest boost.&rdquo;</p>
<p>That&rsquo;s not to say you should rush out and open credit solely to improve your credit mix. Doing that would make you vulnerable to accruing unnecessary debt because you&rsquo;d have more available credit you can use. Your best bet is to shop for credit only when you have a reason to; for example, if you need a car loan to buy a new vehicle.</p>
<h2>Talk to a credit counselor</h2>
<p>If you feel overwhelmed by your finances or debt and aren't quite sure what to do next, meeting with a credit professional could be a smart move. Nonprofit organizations typically offer financial education and possibly credit report analysis for free or at a low cost, and a counselor can also help you create a budget and manage your debt to improve your credit over time. (You can use National Foundation for Credit Counseling NFCC.org to find a non-profit credit counseling agency in your area.)</p>
<p>"Your credit is not a reflection of your personal character; it&rsquo;s just a way for [creditors] to predict how likely you are to pay back your debts in the near future,&rdquo; says Christensen. It can always evolve too. &ldquo;It changes with your financial situation. It changes with your personal commitment and discipline &hellip;bad credit may become good credit in a year or less.&rdquo;</p>
<p>For more advice on building and maintaining credit, visit <a href="https://www.citi.com/resources/citi-financial-pathways" target="_blank" rel="noopener" data-link-source="tiny">Citi Financial Pathways</a>, a new source of articles that can help you make informed decisions for your financial future.&nbsp;</p>
<p>&nbsp;</p>

Try these tips to help raise your credit score, from managing bills responsibly to finding the right credit card.

6 Smart Ways to Help Improve Your Credit Score

Boiler Plate 1

<p>Reasons for a lack of savings can vary &mdash; employment challenges, unmanageable expenses, overspending habits and more &mdash; but one thing is clear: Regularly putting aside funds for your future can be a daunting challenge. (According to a recent report, 32% of U.S. households couldn't cover a $500 emergency expense using only their savings.)</p>
<p>But just because you haven&rsquo;t saved much yet doesn&rsquo;t mean you can&rsquo;t start now. By making a few habit changes, you can build a safety net and get closer to your financial goals.</p>
<h2>Be a strategic shopper</h2>
<p>Online retail sites and delivery apps make impulse buys easy (especially when they allow you to save your credit card information so it will instantly populate) &mdash; and as a result, you've likely spent money on things you regret or rarely use. An easy way to curb this can be deleting your information so the next time you add to cart, you&rsquo;ll have to manually type it in. That brief pause could be just enough to get you to rethink the purchase.</p>
<p>Another good move is to make a deal with yourself: If you want to buy something big, you&rsquo;ll wait 24 hours and then come back to it, suggests Madison Block, a spokesperson for Consumer Credit Counseling, a national nonprofit that helps people regain control of their finances. &ldquo;If you still want it, see if you can rearrange your budget to be able to buy it, or you may find that you&rsquo;re no longer interested in it.&rdquo;</p>
<p>Flipping your perspective can help too. Instead of focusing on the price of an item or how deeply it&rsquo;s been discounted, how about calculating how many hours you'd have to work to pay for it? For example, if you make $20 per hour and the jeans you want to buy are $120, you'd have to put in at least six hours on the job to pay for them. It&rsquo;s a tactic that can help you make better decisions on which purchases are worth it.&nbsp;</p>
<h2><img src="https://www.lifeandmoney.citi.com/rcs/v1/media/lifeandmoney/akpublic/storage/retrieveMediaFile/65c128ae009da053700eb2b3" alt="NotSaving_Body_A"><br>Use a money-management app</h2>
<p>Creating a budget can be a smart way to get a handle on your finances and free up cash, but traditional budgeting requires you to manually track your income and spending, which can be time-consuming. Instead, consider using an app you trust to simplify the process.&nbsp;</p>
<p>Once you sync your bank accounts and credit cards with the app, it will automatically track and categorize your income and spending so you can see where you may be able to make cuts to free up some cash to save.</p>
<h2>Automate your savings</h2>
<p>Consider setting up recurring withdrawals, such as $25 every pay period, to go straight into a savings account through direct deposit rather than into your checking account, suggests Block. &ldquo;That way, you never see the money in your checking account in the first place, so you're sort of tricking yourself into saving because you don't even have to think about it."</p>
<p>Another option is to use an app that will save your spare change; every time you complete a transaction (paying for groceries with a debit card or paying a utility bill online, for example), the app will round up the transaction to the nearest full dollar amount and deposit the difference into your savings account. The little extra deposits can add up over time.</p>
<h2>Sock away any windfalls</h2>
<p>Over the course of the year, you might find yourself with some unexpected funds &mdash; a bonus from work or a gift from a relative, for instance, or perhaps your tax refund.&nbsp; (According to the IRS, the average tax refund in 2023 was $3,167 &mdash; a significant lump sum.)</p>
<p>Think of this as a jump-starter for your savings. Since you didn&rsquo;t account for the sudden influx of cash in your budget, you may be able to stash it away without affecting your normal spending habits.</p>
<h2>Trim your services and subscriptions</h2>
<p>Chances are, you&rsquo;re signed up for at least a few you don&rsquo;t really use &mdash; and cutting those unnecessary charges means more funds for your automated savings deposits. A quick way to do it is to use a cancellation app you trust. It can scan your bank or credit card statements, flag recurring subscriptions for you and even cancel the ones you no longer want on your behalf. Instead of charging a fee, these apps typically take a percentage of your savings.</p>
<p>And keep in mind: Cable packages and phone bills might not be set in stone. Some common services like these can be negotiable if you contact the provider and ask, especially if you&rsquo;re able to cite examples of lower-price options from other providers in your area.</p>
<h2>Keep an eye on your progress</h2>
<p>One reason people struggle with saving is that it can be hard to envision the future and how you&rsquo;re getting there. That&rsquo;s why Sandra Matz, PhD, an associate professor of business at Columbia Business School who studies decision making and consumer behavior, recommends people working toward financial goals track their progress with some kind of visual. It can be as simple as &ldquo;a nice calendar,&rdquo; she says, where, every week or month that you manage to save, say, $50, you mark it off. &ldquo;It's fun, and it's something you can see every day,&rdquo; which can be a big motivator.</p>

Financial pros share their suggestions for setting smart money habits and growing your savings.

Not Really Saving? Use These Tips to Get Started.

<p>Get access to benefits that can help you reach your financial goals, from investing to retirement.</p>