We talk about saving a lot on this blog, so we've decided to pull together a list of our 10 favorite ways to start saving.
1) Set A Budget: TSL
A great way to start saving is to actually set a budget for yourself that includes a line item for savings. At Wela, we encourage the TSL budgeting method which is Taxes (30% of your budget), Savings (20% of your budget) and Life (50% of your budget). Read more about this budgeting method here.
2) Review Your Spending
It's not enough to just set a budget. Hold yourself accountable by regularly reviewing how much, where and when you're spending your money. Mindful spending can help you to see where you can easily save. Remember, nobody is perfect, and there will be times when you slip up and spend more than you wanted. Don't beat yourself up about it, but do recognize that it happened and work to prevent it in the future.
3) Prioritize Your Spending
Do you really need to go out to eat with your friends three times a week? Do you really need all 3,000 channels on your current cable package? Look through all the areas where you're currently spending your hard-earned cash, and see where you can cut back. You don't have to give up going out with your friends or your cable package, but maybe have your friends over for a night in occasionally, or cut your cable package back to just the 1,000 or so channels you actually watch.
When you find a place where you can cut back spending, be sure to then put that savings into your bank account and not another needless expense.
4) Set Your Savings Goal
It's difficult to start saving when you don't know what that chunk of change is going to be spent on later. Is it almost time for you to get a new (or maybe we should say different) car? Are you thinking about buying a house? Maybe you've decided you want to start saving for retirement. Whatever your reason, determine the amount you want to save and your timeline. Make sure your goal is obtainable, and then start saving so you can reach it!
5) Make Saving Automatic
You won't spend money you don't see, so have your bank automatically pull money from your bank account every payday and deposit it into an investment or savings account.
6) Opt-In To Your Company's 401K Program
Roughly 50% of companies offer a 401K program which allows you to easily start saving for retirement. On top of that, many of these companies also offer a matching program which essentially means that if you are saving in their 401K program they'll give you additional money to put towards it. Who doesn't like free money?
7) Give Your Savings Account The Raise
Whether you just received a raise at work, or maybe you just finally paid off your student loans or car payments, rather than giving your lifestyle a raise give your savings account a raise. That way when it's time to give your lifestyle a really stylish raise (a new house, car or vacation) then you can enjoy the good life because you've already saved up for it.
8) Meal Planning
It's easy to overspend when you're at the grocery story and hungry, but what about when you're making two trips a week and none of your ingredients overlap between meals? Putting some thought into what's going onto your plate can make a big impact on how much you spend. Eddie and his wife did a great job covering the amount of money that can be saved with some thoughtful meal planning in this blog.
9) Don't "Checkout" Just Yet
Online shopping makes it easy to find something you never realized you needed. Before you click the checkout button, though, wait 48 hours. This will give you time to think through if you really need that item, or if you just want it. An added bonus is that many online stores send coupons for the items in your "cart" if you leave them hanging.
10) Use Cash Back Rewards Credit Cards
This tip only works if you pay your credit card off in full and on time every month. If you use your credit card as a charge card, a good way to pick up some extra savings is to have a cash back rewards card. For every dollar you spend you can make a small percentage back. Over time, that can add up.
These are just a few of our favorite ways to save money. Tell us about your favorite tips and tricks in the comments.