Just about everyone out there wishes they could save more money. The trick is figuring out how you can actually do it. While everyone spends a lot of time working towards a magic trick that will get them on the road fast, the truth is a bit more complicated.
Budgeting and savings require a change in your lifestyle and your spending habits. This is the key, and it’s both simple and complex at the same time. Learn some budgeting tips to help grow your savings and get you moving towards meeting your financial goals, whether it’s independence or a great retirement.
Set Goals to Grow Your Savings
The first step to grow your savings is to set goals. To do that, it helps to know where you’re going. Why are you trying to save? Is it to establish a rainy day fund? Is it to make a million? Is it to solidify your retirement plans? Maybe it’s just to get yourself out of debt and reverse a trend of being underwater or paycheck to paycheck.
Identify your goal, and then set manageable mileposts you can achieve along the way. Be realistic about what you can manage. If you get too grandiose, you’ll just find yourself getting discouraged.
What You Need vs. What You Want
There’s a big difference between the things you need and the things you want. It can be very hard to cut corners, but if you’re going to save, you need to learn to do it. You might just have to downgrade the speed of your Internet and drop the premium cable package or streaming subscription plans. You might have to forego a meal out, and you might have to eat cheap for awhile.
Saving money means putting aside the things you don’t really need, and squirreling that money away. Make a clear list of what you need, and what you want. Be honest with yourself, and start cutting corners.
Build a Budget
Now that you know what you need to handle, create a budget and stick with it. Again, be realistic about your income and your expenses. If you can, make a weekly budget, but remember big payments that happen less often like insurance payments, tax bills and the like.
Even though you’re cutting corner, make room for a splurge here and there. We need entertainment for our emotional health, and a splurge will help keep you from getting discouraged. Just don’t overdo it.
Create a Savings Account
Don’t just save in your main bill pay account. Create a second account where you put your savings, and do what you can to cut off access to it, so you don’t dip in every time things get a little tight. If it’s an option, don’t have an ATM card for it, so you need to actually go to the bank during bank hours to access your funds. If you have to have an ATM card, consider cutting it up so you can’t use it.
Consider setting up a direct deposit so that a portion of your check goes into this account every time. That way you’ll just forget it was there in the first place, and you’ll learn to live on a bit less while your savings grow.
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