There are many ways to refresh a financial picture such as reducing debt(s) and increasing savings. And most people might be wondering which one of these is more important when deciding where to first put your money.

Paying off debt reduces the amount paid to lenders, since the longer it takes to pay, the more interest accumulates on the debt. This leaves less money for other expenses and savings.

Building savings, on the other hand, creates a source of funds if and when money is urgently needed, like after a job loss or car repairs. Having emergency savings available may prevent people from needing to take on debt or further debt(s) to pay for everyday expenses (such as food, shelter, utilities). You might also be saving up for a planned purchase that you’re going to make soon.

Both saving money and debt repayment are important for financial wellbeing. It may be challenging to decide how to contribute funds to these, while still paying for everyday expenses. If you take a look at all expenses, then you might find an opportunity in your spending plan that is a stretch but also manageable.

Saving does not always come easily. Putting money toward future goals sometimes seems more difficult than buying something that’s right in front of you. We do it, though, because then we have the money when needed in the future.

If you also want to try doing something that your future self will thank you for, start by doing the following:

Review all your debts. Since debt payments appear regularly, it will be helpful to see how much you owe each lender, interest rates, minimum payments, and overdue payments. Review your credit reports from Equifax and TransUnion to see the fuller picture, if applicable.

In terms of paying off debt, the priority would be to make minimum payments on each debt, or to continue doing so. If you have money left over after minimum debt payments and everyday expenses, put more money toward debts with higher interest rates.

Take a look at how much savings you have, or how much savings you want to have. Think about your goals for the future. Do you want to start saving for household furniture? Do you want to save for a damage deposit, or save up for a down payment for a home? Consider thinking about why you’re saving and why you want to put money toward savings. The more you can get excited about plans for your savings, the easier it will be to find room in the spending plan to put money into savings.

If you can spare some money after paying for your everyday expenses and debts, you already have money for a savings account. Or, if your spending takes all your income away, try looking for expenses to cut. You might eat more homemade meals, for example, or wait until your next budget period to buy something that you don’t urgently need. Many experts recommend making savings a habit.

Want to make all this easier on yourself? Try automating your debt payments and savings. A painless way to make sure your money goes to the right place each month is to set automatic debt payments and transfers to your saving account. Many banks can set this up for you.

Paying off debt and adding to your savings are both important, but it can be challenging to decide how to spend funds toward these. Take a careful look at numbers like debts you owe and savings that you want to build, to make the decisions easier on yourself.