5 Simple Lifestyle Changes To Save Money

Financial guru Dave Ramsey once observed, “80% of personal finance is behavior,” as opposed to mastering arcane money knowledge. The principles of building for the future are really pretty simple. Set your goals, determine what you need to achieve those objectives, establish a savings/investment strategy, and – here’s the toughest part – stick to that plan. Disciplined behavior is really the linchpin that holds everything together.

Related: When You Should Adjust Your Financial Plan

With a bit of that discipline, and a sharp eye, you can probably make several small lifestyle changes that will turbo-charge your savings effort. Here are a few suggestions to get you started. Remember, for these changes to pay off, you need to truly embrace them for the long-term.

 Pay yourself first.

You can’t spend what you never see. Go to your company’s payroll department immediately and arrange to have 10% of your net paycheck direct deposited into a savings account or brokerage account. If your employer can’t do that, your bank certainly has a mechanism to accomplish the same objective. Remember: these savings should be in addition to making the maximum contribution to the company 401k.

Ease up on the coffee runs.

Make Starbucks a special occasion thing, say, every other Friday morning. While the coffee shop boom was fueled by a demand for high-quality java, you can now make top-notch coffee at home for the fraction of the average $3.25 per visit to a national coffee shop. Buy a small coffee grinder and a bag of brand name whole bean coffee, and you’ll get close to Starbuck’s quality for well under a buck a cup. Of course, networking and socializing are part of coffee shop culture. No need to forego those important get-togethers. Just remember (discipline), you don’t need to spend $5 or $10 while catching up with your buds.

Bring the party home.

Speaking of socializing, there’s no law or etiquette rule that requires you to meet up with friends at the hippest restaurant in town. That’s cool now and again, but why not stay in touch, and save everybody money, by holding regular potluck dinners? Your crew can take turns hosting, everybody brings a dish, and its BYOB. Boom! A relaxed good time without the credit card receipt hangover.

By The Way-Are you following us on Instagram yet? You should be...Check out what you can do with that extra money you're saving

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Cut (or trim) the cable.

Take a long, hard look at what you are paying to watch TV. Do you really need cable or DirectTV? Maybe so, if you are a serious sports or news junkie. Otherwise, consider dropping cable for a mix of digital on-demand services – Netflix, Hulu, HBOToGo, Amazon Video -- that meets your particular needs. A Netflix streaming subscription ($10 per month) and four new-release movie rentals from Amazon ($24) adds up to a lot less than even a modest cable subscription.

If you must have cable for live sports and/or news, make sure you aren’t paying for more service than you need. Lower your service level if you have channels you never watch. Even if you are happy with your current plan, call your provider and see if you can wrangle a rate reduction. Cable providers are finally feeling the heat of competition. You might be surprised at what they offer.

DIY or shop it.

What chores have you outsourced? Are you paying $20 for a car wash? How much does the lawn guy charge? Yes, your time is valuable, but when you realize you could be “earning” $40 an hour cutting your own grass or washing the car, it’s worth considering. If you do need help with a one-time repair or project (clearing out the basement or cleaning the gutters) take a look at chore outsourcing websites like TaskRabbit. Yes, it might be easier to hire the handyman whose Google ad shows up first, but (discipline) a little effort can reap big savings.

Related: 10 Easy Money Hacks

How much will each of these ideas save you? Not a fortune, for sure. Remember, the real power is in the cumulative effect. Saving just $15 at the coffee shop per week adds up to $780 per year. Saving a $100 a month on dinner with friends is $1200 per year. That’s almost $2,000 per year that could be applied to your long-term savings.

There is money just lying there on the streets of your life. All you need to pocket that dough is, yep, a little discipline.

 

ARE YOU FEELING LIKE JUST ANOTHER STATISTIC?

"If your savings account balance is looking sad, you're not alone.

According to a 2016 GOBankingRates survey, 69% of Americans have less than $1,000 in their savings accounts.

What's more, 34% have no savings at all:

While the numbers seem staggering, it shouldn't come as a huge surprise, consideringabout half of US families have zero retirement account savings .

GOBankingRates also broke down savings by age, so you can see how you stack up against your peers:

How much should you have in the bank?

Most financial advisors recommend having three to six months of living expenses in an emergency fund to pay for unexpected costs.

In addition to establishing a rainy day fund, it's smart to set savings goals for major purchases that you hope will be in your future, like a home, car or vacation. It may be helpful to set up multiple savings accounts in order to save for specific expenses."  

-YAHOO FINANCE

 

Does this all hit close to home? 

There's a darn good chance the answer is yes...but that doesn't mean you can't make a change.

You just need to find a roadmap that works for you...

1. 5 STEPS TO BUILDING A SOLID FINANCIAL FOUNDATION
2. TOP 5 WAYS TECHNOLOGY CAN SAVE YOU MONEY
3.  THE BASICS OF INCOME INVESTING

AND

Don't forget that we are always here to provide feedback and solutions to reach whatever goal you have. 

Financial New Year's Resolution: Creating Your Budget

Part three of our Financial New Year's Resolutions Series tackles ol' faithful: the budget. The beginning of the year is a great time to create and implement a budget, or to reevaluate your current budget and tweak it so it better suites your current lifestyle. Start off 2017 with our steps to your best budget. 

Step 1)  Define your income

For this step you’ll want to list the amount and sources of your gross income. This step is important because you need to know every dollar that is coming into your hand so you can give it a purpose in your budget. This should be your gross income, meaning before any taxes or savings. You might know this number off the top of your head, or you might need to go back and look over your past year’s bank statements to learn exactly how much you earned.

Even if you have your budget together, you’ll want to still take a minute to think through anything that might have changed, like receiving a raise or changing jobs. If you earn money from a hobby or side gigs you’ll want to include this income in this step as well.

Related: Your Budget Workout

Step 2)  List your expenses

Start with your reoccurring monthly obligations like your mortgage or rent, gym membership, car payment, cable, student loan, etc. From here you’ll move to your more amorphous expenses like food, entertainment, utilities and gas. Then think through your expenses that you pay either irregularly or annually like insurance, dental bills, haircuts, shopping, etc. Once you’ve gotten everything written down with a dollar amount next to it, we suggest you look back at the last three months bills to double check if there are any expenses you might have miscalculated.

Related: Spending and Budgeting

Step 3)  Find the difference

Subtract your monthly gross income from your monthly expenses. This is the step that can surprise people. Are you spending more than you’re earning each month? Do you have enough cash flow left for taxes and savings? If you’re looking at a negative number, remember that you can change bad habits. Don’t focus on the negative. Instead, focus on what you can do to improve.

Step 4)  Plan for the future

Now that you understand where your money is coming in, where it’s going out, and what you need to do moving forward, it’s time to put together your budget. Look through your expenses and determine what you need to remove, lower, increase or keep the same with your spending in order to reach your financial goals. On the flip side, you might need to brainstorm ways that you can increase your income. Take some time to write out a realistic budget for yourself next to your current spending habits so you can quickly see what you’ll need to change.

At Wela, we are working to release a new budgeting tool which blog readers can beta test by creating a Wela account and then inside the portal visiting www.yourwela.com/budget. This tool will help you think through what categories you’ll need to include in your budget along with giving you a suggested monthly amount. It can also help you track your budget moving forward. Take this tool for a test drive, and let us know what we could do to improve it.

Suggested New Years Resolution:

I will calculate my current income and spending habits by _____(date)_____. I will put together and implement my new budget by_____(date)_____. I will work with Wela to track and optimize my new budget by _____(date)_____. I will review my budgeting progress every __(week/month/quarter)___.

So now you can budget better. Need help with consistency?

Financial New Year's Resolutions Series  Part Two: Organizing Your Finances