If you have ever experienced the shock of an upcoming expense or sudden change in income, you know how beneficial it is to have a savings account. Most of us, however, could do a lot better in that department. If that sounds like you, there are a few tips to keep in mind that can set you in a better direction. So that way, the next time there is a job loss or a major household appliance breaks (like you need your furnace repaired), you will have a savings account to dip into rather than getting yourself into more debt.
1) Meal plan and shop for the week at the grocery store.
Meal planning is a sure way of not wasting time in the grocery store. The more time you spend in the store the more likely you are to go for impulse buys and rack up the extra charges. Also, be more willing to brown bag it to work or school as well. Stash any money saved into a savings account and watch it add up.
2) Cancel cable.
If you haven’t already, cutting the cord can be a tremendous way to save money. Not only are you cutting back on bills, you are saving in the long run too. Think about how long you usually leave your TV on, especially if you are DVR’ing shows that play while you are away from the home. By cancelling cable, your television and cable hook up aren’t running as much and you will save on electricity.
3) Cut back on indulgences.
Whether it’s smoking, drinking, or lattes, our indulgences add up. Give yourself a budget for these items or cut them out completely. Limit drinking wine or beer to weekends only and go out for that latte one afternoon a week instead of every day. And strive to quit smoking completely because not only is it healthier for your body, it’s healthier for your budget.
4) Create short term goals.
It can be hard to get into the habit of saving if you never have before or don’t have the best habits. Give yourself a short term goal to develop that saving habit. Give yourself something specific to shoot for and a timeline to get to that point. With a goal in mind you are more likely to stick to it.
5) Set up automatic savings.
This is the best way for you to actually save money. Most bank accounts will allow you to save money automatically at a scheduled time per month (or more). Set that money aside and forget about it completely. Consider this your rainy day fund you only touch when you absolutely need it.