The basics of saving

Everyone knows the importance of saving money, but it’s not always so easy. Create your best saving conditions by learning the basics.

Get started with your savings

1. How to start saving?

Set goals! Saving gets easier when you have a good reason. That's why it's a good idea to start with a purpose for your savings. Your goal will give you a set amount to work towards, witch makes for easier planning and motivation. Your progress is also easy to keep track of.

2. Save for a buffer

Your most important type of saving is your buffer, or emergency fund. It's there to protect you in case something should happen. The size of you savings should be able to cover you from immediate trouble. From minor inconveniences such as lost phones or water leaks to bigger things affecting your living situation like the loss of a job or a terminated rental contract. Read more about buffer >

3. Saving for an apartment

The down payment for an apartment is a big savings goal. To get a housing loan approved you are required to pay 15% of the apartment with your own money. Your 15% is called down payment. The size of down payment savings take a lot of discipline and realistic expectations, but with a goal, a plan, and some budgeting, you’ll soon have your apartment. Keep on reading about housing loans >

Man in suit across table offering a small house

4. Saving horizons – how long do you plan on saving?

The time frame you plan on reaching your goal within plays a big part when deciding risk level and type of saving. Generally you'll want less risk if you are close to reaching your goal or saving for a shorter period. While a longer period allows you to take a little more risk. If you are certain that you wont need your money you can even lock your money to a fixed interest rate.

5. Saving long term – retirement funds

It might seem boring and too far away right now, but with all that time comes lots of room to influence your future. With a saving horizon of more than 30 years a lot can happen. Historically placements with higher risk have been favorable over longer periods, but it's important to remember that previous growth isn't a guarantee for future profits.

6. Do your research and compare

Every bank will give you a different loan offer, meaning different interest and fees. Doing your research and comparing offers from various lenders will put you in the best position to make a comfortable decision.

7. How much do I need to save each month?

The most popular budgeting strategies recommends that around 20% of your income after tax is going into some form of savings, that also includes paying off loans and mortgages.

8. How to set a budget

Create some space in your finances by setting a budget. A budget is a good tool for anyone who wants to get a better overview of their money. Know where your spending even before you do it. Read more about the popular 50/30/20-model and try for your self. Read more >

9. What is compound interest?

When interest is added to your savings, it becomes part of the sum you get interest on. A simple way to put it is “interest on interest”. Reinvesting interest into your savings is a good way of making your money grow over time. The more time you have until you'll want to use the money, the longer you have to take advantage of the compound interest effect.

10. Get the right insurance

Economy is the last thing you should worry about when getting sick, injured or if a loved one get hurt. Everyone living or working in Sweden is covered by basic social insurance through Försäkringskassan, there for you when you get sick, injured, have kids, or retire. The state is there in case you need medical care, unemployment pay, pension or allowance for children. If you want extra coverage for your stuff or your home, you will need to pick and get it privately. Read more about the different types of insurances to pick from >