Credit Sesame with 5 tips on how to save money and increase your savings.
We all have monthly expenses and bills to pay, but it’s also important to try to fit savings into our personal monthly budget. Some people have enough disposable monthly income to afford to save on a regular basis. For others, forced savings is the only way to ensure that they continue saving on a regular basis.
Regardless of how much money you earn and regardless of your personal monthly budget, there are several ways to ensure that everyone can afford to save on a regular basis. Even if you are currently repaying personal debts, student loans, or credit cards, you can use these five helpful tips to keep you on track so that you continue saving for your personal financial goals on a regular basis.
1. Budget in your savings
When you sit down to plan or revise your personal monthly budget it is a smart financial idea to add in regular savings as a monthly expense. This ensures that you continue to save money on a regular basis.
2. Save what you can afford
It’s important to be realistic and save only as much money as you can afford so that your money remains in your savings and investment accounts. If you under-budget and try to invest too much money, the odds are that you will probably end up making a withdrawal from your savings account, which completely defeats the purpose of saving. It’s a better idea to save a little bit of money at a time—letting it build slowly rather than not saving at all.
3. Force your savings
The best (and most effective) way to save is to set up automatic transfers from your checking account to your savings account and investment accounts if you have them. To keep up with your budgeting and savings goals, you can set up automatic transfers to coordinate with your pay period, whether it’s on a weekly, biweekly, or monthly basis. This way, when you wake up on the morning of payday, your money has already been transferred to your savings account(s), and you will be less tempted to spend the money.
4. Think long term
Building up your personal savings (like most personal goals) takes time. The key to successful savings is to think long-term and stay focused on your goals. Most people don’t get rich overnight—jackpot and lottery winners excluded, of course, so you have to keep in mind that even saving $50 per month can add up to a lot of money over time.
5. Know your savings options
Traditional or high-yield savings accounts are great options if you’re looking to save cash for emergency funds or short-term goals. However, if you’re searching for more long-term investment options – to save for retirement, for example – you might consider investing in mutual funds, exchange-traded funds, or even individual stocks. With these types of long-term investment options it’s best to consult with a financial planner or someone you trust that knows the ins and outs of each option so that you fully understand them before you decide on which savings plan is right for you.
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Disclaimer: The article and information provided here are for informational purposes only and is not intended as a substitute for professional advice.
