Are you having trouble growing your personal savings? Saving money should be simple, right? It’s not always.
Although it seems easy to put money aside each check or each month into a savings account, there are many obstacles that can get in the way of doing so. For example, if you’ve tried saving before and weren’t successful, where did you fail? Did you have trouble remembering to put the money into your savings?
Did you not have the fund to save? Thankfully, there are many ways to save money. You only need to know what works for you and your unique situation.
To learn how to save money and begin building stable savings, continue reading below. This guide will introduce you to several different ways you can begin saving right now. Let’s get started!
Begin a Retirement Fund
It’s never too late to start a retirement fund. If you don’t already have one, then speak with your employer about starting one. If your employer doesn’t offer this type of benefit, then don’t panic.
You can always open your own retirement account, such as an IRA (individual retirement account). Either way, it’s best to open the account now and get the process started. The sooner you place money into a retirement account, the sooner it’ll add up.
There are also other ways to save your money with the bank, such as CDs (certificate of deposit). If your job doesn’t offer you a 401k, then the best thing to do is head to your bank and speak with them about your options. Remember, there might be some risks involved with certain options.
There could be fees attached to withdrawing money sooner than allowed as well. Although this might seem like a con, it’s better to look at it as a pro. If you’re fined for touching the money, then it might prevent you from dipping into your savings.
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Have Money Automatically Transferred
Once you open a retirement account, you can then have the money automatically transferred each week, paycheck, month, or however you’d like. One of the easiest ways to stop saving money is to forget to transfer the money into your account. You may have no trouble remembering to do so in the beginning, but will you remember to do so after several months or years?
It’s also a good idea to look at the money as if it was never yours or never existed. Don’t look at it as having to give up your money. Placing it into these accounts is only helping you, not hurting you.
When it’s taken out automatically, you won’t have to remember to do it yourself. You also won’t have to ever look at it. Let it transfer automatically and act as if it was never there.
If it’s out of sight, then it’s out of mind.
Spend Mindfully
The fastest way to save a lot of money would be to never spend any of the money you make and to save it all. Unfortunately, this is quite unrealistic. It’s not possible to never spend money.
You need groceries, gas in your car, household items, and to pay your bills. Although you can’t stop spending completely, what you can do is spend more mindfully. Before you buy something, ask yourself if you need it or want it.
If it’s not something you need, then refrain from the purchase. You can also find different ways to save when shopping, such as couponing, using store apps, and searching for discounts. Furthermore, this is a good opportunity to not only learn about the 50 30 20 rule, but put it into practice too. Ultimately, the goal here is to figure out where you can save money.
Start looking into your finances and your spending and determine where you want to make the cuts. For example, if you pay for cable but hardly ever watch television, then is it worth the cost? These are some things to consider.
Set Goals and Create a Plan
Once you get your spending under control, it’s time to set goals and create a plan. What are your saving goals? How much do you want to save by what time?
It’s important to have this figured out so you can plan accordingly. For example, if you want to have $100,000 in your savings within 15 years, then you’ll need to save around $556 a month. You can then break this down into weeks or paychecks.
After you determine your saving goals, you’ll then need to plan how you’ll reach them. Do the math to determine how much money you’ll need to take out of each check. Is the goal realistic?
If it’s not realistic for your income, then adjust your goals so you’re not overdoing it. You can also consider taking on a second job solely for putting money into your savings.
Give Yourself a Budget
Giving yourself a budget is a great way to learn how much you can save each week or month, realistically. When you’re determining your budget, be realistic with yourself. How much can you save without placing yourself in financial stress each month?
Don’t forget to take into consideration all the big expenses too that you might only pay once a year. You should also leave some money for yourself. For example, you don’t want to pay all your bills, buy your necessities, and then place the rest of your money into savings.
Instead, leave some money for yourself and don’t feel bad about treating yourself every now and then.
Open a Second Account
Aside from your IRA accounts, 401ks, and other forms of saving, it doesn’t hurt to open a second bank account for the sole purpose of storing away money in it. Be sure to speak with your bank about the different account options. For example, your bank might offer several types of saving accounts.
Which one has the biggest interest rate? Which one will help you save faster? Placing any extra money into an account like this is beneficial because you can withdraw money from it whenever needed without fees. If there’s an emergency, you can use this money instead of taking money from your other accounts.
Start Paying Off Debt
It can be difficult to save money if you’re in debt. When you’re in debt, it can seem like you take one step forward but two steps back. Don’t do this to yourself.
Start paying your debt off now. You should start with the debt that has the highest interest rate. After your debt is paid off, you can continue to act as if you’re still paying it, but place the money into savings instead. Eliminating debt means increasing your credit score, which is beneficial for several reasons.
If possible, you should also consider only using your cash or debit card and refrain from using credit.
Only Use Credit When Necessary
Because a credit card isn’t your money, it builds interest as long as you still owe on it. For this reason, it’s better to only use your credit cards when necessary. If you’re out of cash and have no other choice, then that’s when to turn to your credit cards.
A good way to build your credit is to use your credit cards for something like gas and then put the money back on your card as soon as you use it.
Track What You Spend
Tracking your expenses is a must. If you’re not already doing so, then the time to start is now. Watch your checking and savings accounts. Download apps from your bank for easy access to your funds and transactions.
Do you see anything that’s not familiar? Dispute it with the bank. Do you see lots of money being spent on items you don’t need, such as eating out a lot?
Track where every dollar goes to help you plan how to cut back. This will also help prevent you from overdraft fees. Tracking your tax information and tax return is also important.
Not paying the IRS on time can lead to fees. To ensure your taxes are received by the IRS on time, send your returns using certified mail. Be sure to learn more about mailing your taxes via certified mail before opting for another option.
Are You Ready to Grow Your Personal Savings?
Are you ready to get started? Growing a personal savings account is much easier said than done. Properly saving requires planning, budgeting, self-discipline, and hard work.
Use the helpful information listed in the guide above to start your own personal savings journey. With this guide handy, you’ll have a healthy savings account in no time!
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