Tips To Save Money
Ready to turn over a new leaf and become a professional saver? Here are some of our best money saving tips.
1. Set Up Your Budget
How can you start saving if you do not know where your money is going? Fill in a simple spreadsheet with all of your expenses. Be sure to include allotments for food, gas and entertainment.
Once you can see where your money is going, you can see how much you should be saving. Ideally, you should be saving 20% of your take home pay. If you can not do this, you should make the budget cuts needed so that you can achieve that savings rate.
2. Automate Savings
It is easier to save money if it is done for you. If your employer allows you to split your direct deposit, do so. Take 20 percent of your take home, or as close to it as you can, and deposit it into a savings account.
If splitting your direct deposit is not an option, set up an automatic transfer from your checking to your savings. Make it for the same day that you receive your check.
Automatic saving transfers make it easier for you to save because you never see the money.
3. Cut Up Your Credit Cards
If you are carrying credit card debt, you might be wasting hundreds of dollars a month in minimum credit card payments. Make it a priority to get these cards paid down quickly. You can then take those minimum payments and put it towards your savings.
Step one it is to cut the cards up to prevent future spending. Next, employ the debt snowball method to stay motivated to pay down the debt. Pay all of the minimums on your cards except for the lowest balance one. Pay the maximum you can on that card until it is paid off. Once it is, move to the next card. This method allows you to stay motivated because you will see cards get paid off quicker.
Getting rid of credit card will not only save you money. It could also help you take your fair credit rating to the next level.
4. Save For Once A Year Payments
There are things that you pay once a year that can wreck your budget. This might be Christmas shopping or it could be that yearly HOA payment.
Rather than try to pay for them all at once, split these expenses into 12 equal payments and make it part of your monthly budget. Set up a savings account for the money and then withdraw it as needed. Think of it as an escrow account for big annual expenses.
5. Audit Your Expenses
Once a year, go through your expenses and see if there is a way to save. Look at your auto insurance to see if you are getting the best deal, see if there are any satellite television deals you are missing out on, etc, etc.
Take the money that you save and reallocate it to your savings account. It is essentially found money since it is money you were used to paying, so you will never miss it.
6. Max Your 401K
If you are not getting the maximum employer match to your 401K, you are throwing money away. Make sure that you contribute enough money so that your employer is giving you their maximum contribution. This is how to get money for free because it doesn’t cost you a dime.
As a side note, if you are eligible for a 401K loan and have credit card debt, consider taking one out to pay off your card balances. The payment and interest will be less and it would allow you to save more money.
7. Get Healthy & Save
Do you go out to lunch every day? If so, you are putting your wallet and your health at risk. Restaurant food, especially fast food, is usually high in fat and unnecessarily high in calories.
Whenever I need money, this is my go to method. Instead of spending $10 to $15 a day to eat out, make your lunch at home and bring it with you. You will be able to save money while eating a healthier and more calorie appropriate meal.
In addition to the money savings, which can easily be $200 to $300 a month, there is a huge time savings. Eat your lunch in 15 minutes when it would have taken your entire lunch hour at a restaurant. Use the extra time to go for a walk or climb some stairs at work. Do this for a few months and you will have a stronger savings account and a slimmer waistline.
8. Cut Your Grocery Spending
While we are talking about food, let’s cut the grocery budget and put that money into savings.
Start by always using a list when you go shopping and never deviate. Lack the willpower to resist the supermarket end cap? Shop online and pick it up curbside.
Next, join a discount club and start buying in bulk. You can save a fortune on dry goods at warehouse stores, making them well worth the annual fee.
Finally, switch to some cheap staples as the basis of your meals. Beans, rice, potatoes and even pasta can be bought super cheap in bulk and are the basis of dozens of meals.
9. Entertain Yourself For Free
Free events are everywhere, in just about every city. Take a look at the city calendar in your city and surrounding cities in a ten mile radius. Check out what kind of events they have for free. Chances are that they will have free concerts, movies in the park, educational classes or even craft fairs. Lot’s of ways to entertain yourself for free.
Don’t forget about parks as well. Perhaps invest in an inexpensive used bike from the online classified and take up bike riding in the park. Have you not gone fishing since you were a child? Get a cheap fishing license and some inexpensive gear and get an affordable hobby.
10. Start A 30 Day Rule
Set a spending limit and wait before buying anything over that limit. Your limit could be 100 dollars or maybe 300 dollars, this will be a personal amount based on your level of income.
If you want to make a purchase above that limit, you need to wait 30 days. If you still want it, buy it. Chances are good though that your interests will have already strayed. The 30 day rule keeps you from wasting money on things you may not really want long term.
There are literally dozens of ways to save money when you put your mind and your budget to work. Implement the ones above and then keep going. Perhaps you can start a side job to make money for savings or start walking more to save fuel. The options are endless.