We all understand the importance of saving money for unexpected emergencies such as a broken heater in the middle of the winter or for our retirement. However, like other commitments in life, saving for the future is often easier said than done.
Many people struggle to save because their daily expenses eclipse their earnings. But at times, lack of saving can be attributed to psychological factors. Studies show that saving demands a great deal of self-control, forethought, and willpower—virtues that are always in direct conflict with our current desire for pleasure and satisfaction.
So, what can you do? Well, the key to saving is knowing your weaknesses and using tried and tested strategies that can help you take the right steps without thinking too hard about it.
How to Save money?
Set Proper Saving Goals
One of the top secrets of saving is visualizing what you are saving for. Set clear targets along with timelines to make your saving process easier. If you want to purchase a house in 3 years with a 30 percent down payment, for instance, have a target of what you need to save every month to achieve your goal.
Automate Your Savings
To meet your saving goals, you need to make a saving as seamless as possible—and spending more difficult. Auto-save a portion of income to a saving account. By having your paycheck automatically transferred into a saving account, you will be less inclined to touch the money. This is will be much easier if you resist the temptation to spend.
Track your Expenditure
Do you know how much you spend in Starbucks per month? Well, you may be surprised by the actual amount once you begin tracking your expenses. Get a budgeting app that aggregates all your financial accounts, including your debit and credit cards, brokerage accounts, and retirement accounts among others. If you get an accurate sense of your finances, you’ll definitely think twice before you spend that $1000 on a Canada Goose Parka.
Pay Yourself First
If you cannot commit to a long-term saving plan, one of the tricks you can adopt is to set up an auto debit from your income or checking account to savings account every payday.
Make Use of Coupons
Whether you buy online or offline you should always look for coupon codes. Most of the stores offer now discount codes and you can save sometimes up to 80%. The key is to know what to look for. The first and foremost thing you should do is to visit coupon sites such as https://couponcause.com/. They have coupons for almost every well-known store and you can apply the coupon at checkout or simply use their link to make the purchase. This is an easy way and take only a few minutes but can save you some money.
Clear Your Debts
If you are trying to save through cutting your expenses but still carry a huge debt burden, you need to change your strategy: start with the debt. To see why to try to figure out the amount of money that you spend servicing your debt every month. Once you’ve cleared your debt, you can put the money into savings.
Focus on Utility Savings
Lowering your water heater’s energy consumption can save you between 3%-5% in energy costs. And installing a tankless water heater can give you up to 30% savings compared to conventional storage tank water heater.
“Staycation” still works!
Instead of spending several thousand on airline tickets for overseas holidays, look for fun vacations close to your home. In case it doesn’t make economic sense to drive the distance, scout for cheap flights in your region.
There you have it; some of the best ways to save money that actually works. Hopefully, the steps will help you save a good amount of money each and every month.
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