It’s not easy to save money these days. Countless families in the US are dealing with things like rising living costs and additional expenses, while wages seem to remain the same. In fact, money is tight enough that it can be difficult to see saving money as anything more than a pipedream.
The good news is that there are ways that you can positively change your spending habits and set yourself up for more financial freedom in the future. With the following tips, you’ll be able to increase your chances of achieving both your short-term financial goals, like saving for a family holiday and your long-term targets too.
Make a Budget
The first thing you need to do if you want to save more during tough times is create a budget. Budgeting exists at the heart of any savings plan, as it helps you to understand where you’re spending your money, and what you need to do to cut costs. Check your credit card statements, look at your bank statements and find out as much as you can about how much money you have coming in, and how much you have going out.
Once you know where your money is going each month, you can begin to ask yourself whether you can reasonably afford to cut down in any specific areas. The key is to get your priorities right here. Think about which expenses you have to handle like mortgage payments and food bills, and which you can do without.
Track your Spending
One of the biggest problems that people face with their budgeting habits is that they assume that spending a little extra on something like a cup of coffee or a lunch at work won’t add up to much in the long-term. The truth is that it’s the little expenses that often have the biggest impact on us.
Keeping track of your day-to-day spending is how you make sure that you’re not accidentally living beyond your means. Your bank statement will help you with tracking costs but make a habit of writing down everything you spend when you can too. Just the knowledge that you’re tracking your spending might actually be enough to ward-off impulse buys.
Open A Savings Account
If you really want to make sure that you stick to your savings goals, a great idea to is to place the cash that you want to save into a place where you can’t easily access it. It’s too simply to tell yourself that you’ll pay yourself back when you tap into savings that you’re holding onto in your current account. Opening a separate savings account forces you to think differently about the way you separate your money.
The important thing to remember is that if you’re going tog et the most out of your savings account, you have to make sure you commit yourself to not withdrawing anything out of it – unless it’s an emergency. Even then, it’s a good idea to have an emergency fund to tap into instead if you can.
Focus on the Recurring Expenses
When it comes to budgeting, every little bit helps. However, it’s the large recurring expenses that generally give you the most access to additional savings. Just because you think that you have to pay your broadband bills and loan interest repayments every month, doesn’t necessarily mean that you have to pay above the odds.
Take your loans for example, comparing the options available to you before you get a loan can be a great way to reduce your monthly expenses to make sure that you’re dealing with the lowest possible APR. You can also keep the same idea in mind when you’re comparing options for recurring expenses like broadband bills and car insurance.
Manage your Impulses
Finally, remember that your impulses are often the enemy when it comes to saving money. It’s so easy to over-spend when all you need to do is flash a credit or debit card. These days, you don’t even have to enter a pin number to use your money. A good way to manage your impulses is to think about how you can reduce temptation.
For instance, if you know, you’re going to the supermarket to buy food for the week, write a list of what you need and only take enough money for the items on that list. This way, if you want to buy something extra, you’ll need to go back home to retrieve more money, and that will give you time to think about your spending choices.