How to Build and Grow Your Life Savings

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Laying the Foundation for a Well-Managed Life Savings Fund

This article is Part 2 of 5 of
Your Total Guide to Managing Life Savings: Exposing The Best-Kept Secrets


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Building a life savings need not be the turf of the rich. Everyone, regardless of income status and personal economics can build a lifesavings based on how one can afford funding it, and when one is finally ready to start building it.

Just like maintaining a regular savings account and even simply saving like we did with our childhood piggy banks, building a life savings is quite easy. All it takes are discipline, patience and  good old financial advices along the way. Here are some of them:


That is, round up the first contribution you want to “break in” a life savings account. For many major goals savers, this starting phase is the most important because it defines your commitment to really stick to have this kind of fund. Once you have made a good start, continuing becomes easier.

As we have suggested earlier, you can start by alloting an expected money within the year like bonuses and tax reimbursements. This can be supplemented with any spare money you have after all financial obligations have been met, including depositing to your primary savings account or emergency fund. You can also save up for this first batch of your life savings contribution, just like you would save for a need or a want.


Deciding where to put, maintain and grow your life savings is very important.



  1. It’s the safest and easiest choice.

  2. You regularly keep track of your progress with your monthly statement which makes your record-keeping easier and accurate.

  3. You can earn interest. You have help in growing your money.

Disadvantage: You can easily be tempted to dip into it.

Putting your life savings in a pension plan or a time deposit

Advantage: Your money grows with higher interest compared to standard bank account.

Disadvantage: This means that you can’t dip into it, which can be a good or a bad thing, as we will see later on.

Personal safekeeping

Some people actually feel more secure in having their money physically near then, stashed away in a secret protected place somewhere in the house. A safety deposit box is the best choice when one opts for personal safekeeping.

Advantage: You have access to your money at any time.


  1. It’s a risky thing to do. Anything can happen to your money even if it’s in a safe and locked place.

  2. It does not bear interest.

  3. The elderly may forget where they put it.


As they are intended for future major goals, you can explore savings builders outside of your own resources to help build your life savings. For instance, you can make the money market work and help you grow your life savings, though extreme care and caution should be exercised when one opts for this strategy.

Read more:  How To Choose Best Help Desk Software: 5 Strategies That Guarantee A Solid Purchase

The best and safest way to build your life savings is to find out more about life savings strategies. Read. Ask around. Consult professionals. Here are some ideas to get you started. Again, always seek professional guidance if you want to explore these.

  • Put in short-term, high-yielding but low risk investments. Market-based investments like mutual funds, segregated funds, stocks, bonds, exchange traded bonds, futures and derivatives are just some of the options you can explore to grow your money faster compared to guaranteed interest products. But since they are that – market-based, you can also lose your money at any time.

  • Avoid any unnecessary tax your life savings may entail.

  • Explore cash-convertible benefits you, your family or your owned assets may have that can be added up to your life savings


We have said time and again that life savings are intended for long-term, major life goals. Hence, its value can be further stretched by exploring its potential growth. Only, be careful when you decide to “invest” your life savings.

Think about investment-linked savings but choose low-risk ones, or those that provide guaranteed returns on investments like a certificate of deposit (CDs). These low or no-risk products often come with a small penalty when you withdraw your money before maturity date, so keep that in mind. However, this is where having a separate emergency fund comes in handy, because then you can leave your invested life savings fund alone even when emergency strikes.

The best way is to “diversify” your life savings in terms of security and potential growth. You can split your savings by taking only a portion to be invested in the low-risk money market, another portion for the guaranteed interest investments while the bigger chunk stays in the bank or where you want it, safe and secure from the volatile market forces.

The Roth IRA can be a separate branch of your life savings, for retirement and post-working life goals. Its principal can be withdrawn without penalty with some conditions, like age.

Do you want to know the secrets to staying focused on your life savings commitments?

Continue reading Part 3: How to  Commit to a Life Savings Goals: Checking Your Money Views


By Nestor Gilbert

Senior writer for FinancesOnline. If he is not writing about the booming SaaS and B2B industry, with special focus on developments in CRM and business intelligence software spaces, he is editing manuscripts for aspiring and veteran authors. He has compiled years of experience editing book titles and writing for popular marketing and technical publications.

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