How to Create a Personal Savings Plan

Determine what it is you want to achieve. Do you want to save for a vacation, set aside money to purchase a home or add to your retirement nest egg? Creating a list of specific short and long-term goals can help you form the blueprint for your savings plan.

Create a budget to determine how much money you have to put toward savings each month. Make a list of all the money you have coming in each month from your job, any investments you own, alimony, child support or any other source of income. Next, make a list of all the expenses you pay each month, including fixed costs for your rent or mortgage, utilities, cable, Internet and variable costs for clothing, entertainment and transportation. If your expenses are less than your income, the difference represents your starting point for saving.

Identify what it is you need to do to achieve your savings goals. For example, one of your goals might be to save $3,000 for a vacation that's six months away. If you're paid on a biweekly basis, you would need to set aside $250 a paycheck in order to reach your goal. Creating a specific action plan detailing what you need to do in order to reach your goal can help you measure your progress and stay on track.

Go over your budget to look for expenses that can be reduced or eliminated. For example, you might consider cutting back on your cell phone or cable service or dropping your gym membership. It's helpful to keep track of the money you spend on non-essentials, such as clothing or entertainment, to look for areas where you can cut back. As you trim your budget, you free up more money to put toward your savings goals.