Why do we save money? To buy bigger and better things, right? It’s not always so simple, though. Sure, when we are young, saving money is pretty easy; we don’t have much of it to spend in the first place! Once we start earning our own money, though, it can be hard to know how to start saving—and even harder to stick with it! These five ways to start saving money today can help you get started and make sure you stay on track.
1) Pay your monthly bills as soon as possible
Let’s face it, paying bills can be a drag, but it’s not nearly as bad as getting a pile of late fees. One way to prevent overspending is by paying your monthly bills as soon as possible. Not only will you avoid fees and fines that come with delayed payments, but you’ll also save money on interest charges. A credit card that has a 15 percent interest rate costs you $10 for every $100 you carry from month-to-month—and those hidden charges can really add up if you carry debt from month-to-month year after year. Paying your bills early will allow you to reduce or eliminate unnecessary interest charges and use your cash flow more wisely.
2) Automate your savings
For an easy way to start saving money and help ensure your future, set up automatic transfers from your checking account into a savings account. This simple practice can take away any of those pesky reminders that might make you change your mind about saving (Oh, I have plans for tonight... or I really don’t need that new pair of shoes...). With some banks offering 0.01% APY on savings accounts, you may think that setting up automatic transfers may not be worth it—but studies have shown that people who save automatically are more likely to increase their savings than those who save manually. Automating helps prevent spending by getting money out of your sight and out of your hands.
3) Track your spending
It’s easy to lose track of how much money you’re spending and where it’s going. To start saving more money, start by tracking your spending. Put all your expenses into a spreadsheet or an app that helps you categorize spending into different buckets (food, entertainment, travel, etc.) for easier analysis. When you can see how much money you actually spend on certain categories, it’ll be easier to identify areas where you can cut costs and save some cash.
4) Change your mindset about spending
Saving money relies heavily on how you look at your finances. If you treat it as if you're a chronic spender, you'll always be broke. This means having a different mindset about spending money. No longer see it as a goal but as an opportunity. Sometimes living frugally is a good idea and will save you money. However, the key is to make more money or be able to be paid for the added services. In that case, what are you waiting for? Drop your iced latte and get to work! If you take care of your financial health, you'll have it.
5) Increase your income
Instead of cutting back on your expenses, find a way to increase your income so you don't have to trim expenses. Pick up a few side projects or get a part-time job to pay the bills; these are just two simple ways to make money in a jiffy. Blogs will be arriving here about how to make income and increase it.
Conclusion
There’s nothing wrong with getting a head start on saving money: You can earn extra cash today, and you can implement your savings plan tomorrow. For many, being responsible with money is a constant struggle—but if you make time for personal finance in your day-to-day life, it becomes part of your routine. Remember that having an emergency fund gives you peace of mind so that you’re prepared for what life throws at you. Take charge of your finances and kickstart your savings plan today!
