There are people who are naturally gifted at saving money. However, you are not alone if you are not one of these lucky people. Almost 70% of Americans have less than $1,000 in their savings account. Saving more money is not easy. It is a struggle that needs hard work and new habits. Each month, you might start out with good intentions on how you want to budget your funds. But along the way, you end up buying unexpected things that ruin your plans. Sound like you? Read on for some clever ways to increase your savings.
1. Focus on Your Why
Most of the tips for saving money are very simple but will test your self-discipline. Before you learn ways to increase your savings, you first have to decide why you want to save in the first place. Saving for school, your kids’ school, a special vacay (hopefully soon!) or a home improvement project? Keeping your why in mind can help you stay focused on your savings journey.
2. Be Honest With Yourself
Perhaps the reason why you haven’t saved more is that you haven’t been honest about how you spend your money. It’s not easy recognizing that maybe you’ve gone a little wild on spending or that you’re living beyond your means and relying on credit cards. But you can be proud when you take a look at your habits and become aware and ready to get to work and make healthy changes.
3. Assess Your financial Mentality
When you hear the word “savings,” what’s the first thing you think of? Do you get excited about it, or do you dread this word? The truth is, maybe the reason why you’re not saving enough is because of what’s on your mind. Whenever it’s convenient, set a specific time to assess yourself and figure out what you think about money, and challenge yourself to spend less. For example, if you think money should be spent as it comes, ask yourself how this mentality has served you over the past few months or years.
4. Know Your Wants VS. Needs
There’s nothing wrong with buying expensive things. The issue is buying anything and everything you fancy. List the items that you cannot live without or those that would bring the most change in your life if they disappeared. This includes your apartment or house, food and phone, among other needs. Then, create a list of non-essential purchases. As much as possible, try not to buy everything on your want list at the same time. Instead, pick a goal and establish a budget for it. Save money then reward yourself if you’ve reached a milestone.
5. Master Your Cash Flow
Your cash flow includes the money that comes and goes to and from your account. You may think you already know the gist of this, but you have to account for it. For example, you may get paid every two weeks and spend a set amount of your salary on rent and food. Leverage technology by using money tracking apps to know where the rest of your money goes.
6. Learn to Negotiate
After you’ve learned how to track your expenses, the next step you need to do is know how to negotiate your bills. Chances are you are overpaying for some services, and there may be some you don’t need. Negotiating will take up a small chunk of your time, but your savings will add up.
7. Use the 30-Day Rule
Buyer’s remorse is a real thing, but you can’t do anything about it because you’ve already spent money, right? If you don’t want to regret a purchase, especially a major one, practice the 30-day rule. Every time you want to buy something, set it aside for a month. If you still want to get it after 30 days, then do it. This will significantly cut down impulsive expenses.
Instead of overwhelming yourself by applying all the tips listed here, start with one or two ways to increase your savings. By starting small, you can build a stronger foundation.