How to Create a 1% Fund
505 views · Published 10 March 2016 · 2:38 · Indexed 19 October 2026
Channel: Utah State University Extension · 2016 · Howto & Style
Amanda Christensen, USU Extension, Morgan County ......... Hello, I’m Amanda Christensen with Utah State University Extension, and today’s quick tip is all about a 1% fund. Incorporating a 1% fund into your financial strategy is a simple, easy way to set aside money for whatever expense or whatever purpose you choose. The key to using a 1% fund is to create a separate account at your bank or credit union or financial institution. Once you have that separate account created, then you make an automatic payment every month out of your paycheck into this 1% fund. If you can’t do that straight from you pay check, then once the money is in the account, you can make a 1% payment to the 1% fund. And you ought to be able to automate this so you don’t have to physically make the transfer every month. Automating the 1% payment is key to being successful using this 1% fund strategy. Why 1%? Why not 2, or 3, or 4, or 5, or 10? The reason I recommend a 1% fund is because as the money comes out of your budget, you won’t notice it as much as you would 10%. It’s a tiny amount that adds up over time, but you won’t feel the pressure of that money coming out of your month-to-month budget. As this 1% fund builds up over time, you can use this money for whatever you choose. Maybe to save for a big family vacation, maybe as an extra pot of money to give to charity, or when the kids come knocking at the door selling candy bars or girl scout cookies. Maybe for a secret Santa project this Christmas. Maybe you could use your 1% fund to save for an educational opportunity coming up. There are many ways, and the sky’s the limit. One of the greatest ways to use a 1% fund is to save for Christmas expenses. Christmas is this fabulous holiday that comes around every year, and yet it still throws us off guard if we’re not prepared financially. However you choose to use it, I know it’s been a financial tool that I’ve loved, and I’m happy to share with you. If you have any questions about a 1% fund, leave it in the comments below. I would love to respond. Also check the description box for ways to reach out to me on social media and give me some more tips. What would you like to see on these quick tip financial videos? I would love to know. Thanks for stopping by. I’m Amanda Christensen from Utah State University Extension. We’ll see you soon, bye. .............. Connect with USU Extension! Facebook - http://facebook.com/usuextension Twitter - http://twitter.com/usuextension Pinterest - http://pinterest.com/usuextension LinkedIn - http://linkedin.com/company/usuextension Google+ - https://plus.google.com/+usuextension
