You don’t need to be rich to start investing or saving money. Even people working at their first jobs or newlyweds living on a tight budget can develop the habit of saving.

Here are five ways to automate your savings program to make it effortless:

1. Set up a savings account and simply arrange automatic transfers from your checking into your savings account. Schedule the transfer to happen between two and five days after your paycheck is deposited.

2. Set up a TreasuryDirect account at the U.S. Treasury and make automatic deposits. You can arrange for monthly deposits of $25 and up.

3. Take a look at the new myRA (“My Retirement Account”) program. It lets you build savings in what is essentially a Roth IRA. You can start with as little as $25 to open the account, and you can deposit as little as $5 per month.

4. Get started with a dividend reinvestment program (DRIP) with the Moneypaper folks. They have put a lot of energy into helping children learn the fundamentals of savings and retirement investing. In fact, Moneypaper can demonstrate how saving $25 per month can turn into over $1 million by retirement age.

5. Contribute to your employer-sponsored retirement account. This is especially worthwhile if your employer matches your contributions. Smart employees make payroll contributions to the level the employer will match (sometimes half, sometimes the entire contribution). Anything over that is just gravy.

How much can you contribute to a typical employer plan depends on the plan:

With a SIMPLE IRA plan, you may contribute 100 percent of your wages, up to $12,000 for 2014 (you can add an additional $2,500 if you’re age 50 or over). Your employer is required either to match your elective deferrals up to 3 percent of your salary or to match 2 percent of your salary no matter how much you deferred.

There is one drawback: If you draw this money out in less than two years, the penalty is 25 percent.

With a 401(k) or qualified plan, you may contribute up to $17,500 (you can add an additional $5,500 if you’re age 50 or over). Your employer may establish a plan with a choice, where you may deposit the money in a Roth version of the plan without getting any tax deduction for your contribution or deposit it into a regular retirement account, where your contributions reduce your taxable income. Your employer may even match your contributions or provide profit sharing, which could bring your total benefit up to $52,000 ($57,500 for age 50 or over).

Many of these plans allow you to borrow from them. Typically, you may borrow either up to 50 percent of your plan’s value or $50,000, whichever is lower. This is a powerful tool for those expecting to keep their jobs long enough to pay the money back. You pay no taxes on the loan unless you leave the job before repayment, so you don’t diminish your retirement savings.

You have a lot more options, especially if you’re self-employed. Check out the IRS website for details.

Eva Rosenberg, EA is the publisher of ®, where your tax questions are answered. She is the author of several books and ebooks, including Small Business Taxes Made Easy. Eva teaches a tax pro course at and tax courses you might enjoy at

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