You can find a lot of tips on how to save money, however, whether or not these tips will work for you depends on nothing else but you. The success of saving money will always depend on your spending habits, and how you do things to make it work for you.
In a data presented by Gallup back in 2017, it says that 59% of Americans “claim to be a person who enjoys saving more than spending,” while 38% prefer spending over saving. These numbers only mean that the majority of American adults still see themselves as people who enjoy saving than spending money.
Meanwhile, in an article published by CNN Money also in 2017, it says that based on a new study by Bankrate.com, the percentage of Americans who have adequate or enough savings to cover six months of expenses has jumped to 31%, which is definitely higher compared to the years before that. While there are still a lot of Americans who have no savings at all, the jump in number is a good start. It shows that Americans’ saving habits are improving.
Furthermore, in the same study, it showed that the ones with the highest levels of having enough savings are the younger people, particularly those aged 18 to 26 years old. It’s actually quite surprising because a lot of people thought that the young ones spend more. However, the study shows otherwise.
To be honest, saving money can really be challenging. It takes a lot of discipline to be able to save regardless of how small your monthly income is. It also takes a lot of effort, really. The world is full of temptations, and some of these you can hardly resist.
However, as we have said, if you really want to save money, and you really want to make it work, you have to change your ways. You have to work hard to make things work.
Now, before we talk about the different tips on how to save money, for you to better appreciate saving, let’s talk about its importance first.
IMPORTANCE OF SAVING MONEY
Whenever you hear about saving money, what usually comes to your mind?
How do you define saving money?
For some, saving money means being financially secured. Others, saving money means being able to eventually splurge. There are also people who thought of saving money as a way to ensure that their families will have a good future.
But what does saving money really means? What is its importance to us?
According to an article published by Investopedia, it defines saving money as something that is really important, because having savings means having peace of mind. It spares you from worrying about the rainy days. Also, saving money “expands your options for decisions that have a major effect on your quality of life, and eventually gives you the option to retire”.
The process of saving money, however, requires hard work, determination, making smart decisions, as well as putting your money into the right places like investments and more.
Contrary to what other people believe in, saving money does not require a huge amount of money being set aside on a day to day basis. The amount of money you save – regardless of how big or small – does not matter (unless of course, you have a specific thing you are saving money for). The important thing is the act of saving. Period.
Before moving on, you may want to check the below video by Nate O’Brien wherein he shares different tips on how to save money. Click the play button if you are interested.
TIPS ON SAVING MONEY
Now, with all these numbers and studies, one thing remains – there is still work that needs to be done for American adults to learn how to effectively save money.
Having said that, here are some tips on how to save money effectively:
1. Record Your Expenses
This habit is actually common among women, especially moms. A lot of women are used to taking down the expenses they make in a day.
While this is a very basic practice, it is no doubt very effective. By tracking your expenses, you get to know more about your spending habits. You learn about where you spend most of your money on.
Also, when the times come that you realize how bad your savings are, you can look back and check which ones you can change.
Now, back then, people are used to writing down the expenses in a journal. Thanks to technology, today, there are a lot of tools that you can use to track down your daily expenses. We actually tackled some of the existing tools that people use nowadays when it comes to budgeting and personal finance management.
Here are some of our blog posts, which we thought can be really helpful to anyone who wants to learn about saving, budgeting, and overall finance management:
- How To Create Your Personal Bullet Journal Expense Tracker
- Personal Capital Vs Mint: Your Guide To Better Personal Finance Management
- Mint vs EveryDollar: The Best Budget And Personal Finance App For You
2. Set Aside a Budget for Savings
Yes, you read it right. Savings is not how much money is left after all your spending. Savings must be part of your monthly budget.
Ideally, financial experts say that every person should aim to save at least 10 to 15 percent of their monthly income. If you can save more, better.
The moment you receive your monthly income, make sure to set aside a specific portion of it for savings. Again, savings are now how much money is left after spending, but it is part of your monthly expenses. You consider it as an expense and forget about it — that’s how it works for some of us.
Now, if you think 10 to 15 percent is a little too high for you, you can start smaller than that and eventually, increase once you think you already can. At the end of the day, the important thing is, you save money.
3. Spend Wisely
This is old-school advice, but it really is true. To be able to save money, you got to spend your money wisely.
Make sure to prioritize your needs over your wants. Before you even think of buying something especially when it falls over the “wants” category, you better think a million times and way if it really is worth spending on.
Now, if there really is a need to spend on things, you better do a lot of research, and also, we recommend checking on sale items. It will surely help you spend less, and save more.
For instance, if you are buying a piece of furniture for the house, make sure to check all the shops that offer affordable furniture. You may check a blog we wrote about different underpriced items, and where to find them in the link below:
For women, if you love makeup and other personal care products, you may consider store memberships. Like in Sephora, they offer exclusive promos and discounts to its Sephora VIB members. If you want to know more, check the blog post below:
Also, consider using cashback apps. It’s one way of saving money from the items you normally buy. Here’s a blog post that you can check out to have an idea:
4. Choose the Right Tools
Choosing the right tools depends on your saving goals.
For instance, if you are saving for short-term goals, you may consider using FDIC-insured deposit accounts like a savings account and Certificate of Deposit.
Meanwhile, for long-term goals, you can either put your money through investments or insurance.
If you want to know your options, or if you want to learn about either or both options, you may check below blog posts:
- Policygenius Review: Is This Platform Worth It For You?
- Your Guide In Understanding What Embrace Pet Insurance Is All About
- 11 Companies That Offer Cheapest Car Insurance Rates
- Ethos vs Haven vs Ladder vs Bestow vs Fabric: The Best Life Insurance Online
- Motif Investing Review: Is It A Great Investment Tool For You?
- TradeKing: Is It The Right Online Discount Broker For You?
We just want to say also that choosing the right tools also include, choosing the right software for your financial needs and responsibilities – which include paying taxes.
Having said that, here are some blogs that will help you as you choose the right tax software for your tax filing needs:
- 5 Best Tax Software In 2020 Based On Specific Categories
- TurboTax Vs H&R Block: Which Is Right For Your Tax Filing Needs?
- TurboTax Free Edition Review: 7 Common Questions Answered
5. Know Your Priorities
The best way to achieve a healthy saving habit is to always know your priorities. Have a clear idea of where to start saving.
For example, you aim to buy a house in the future, then make sure that you start putting money away for that purpose.
Another example is when you have debts, make sure that you work on paying it to be able to save more. We actually recommend making sure you are debt-free so it is easier to save.
Speaking of debts, you may consider checking these blogs that talk about financing, and also, it gives you an idea where to run into in case of financial emergencies – specifically aiming for lower interest rates and all so it’s easier to pay off.
- What You Need To Know About Refinancing With SoFi
- Scratchpay Vs Carecredit: Choosing The Right Vet Financing Plan For You
6. Set Your Savings Goals
One of the best tips on how to save money is setting savings goals. It can be buying a new car, a house, getting married, a grand vacation with the family, or saving for early retirement. Whatever it is, it will help you push yourself to do the best you could to be able to meet that goal or those goals.
Depending on what you are saving money for, you can find ways to help you save more by doing extra work or extra side hustles. Some simple side hustles include making money through recycling or holding a garage sale.
Here are blog posts that will help you get an idea about how to earn extra cash from recycling and garage sale:
- Recycling Price For Aluminum Cans: Your Guide
- How To Create An Ad And Hold A Garage Sale On Craiglist
Furthermore, there are also other ways to make more money, which means more savings for you to be able to achieve your goals sooner. To give you ideas, you may check the following blog posts:
- 21 Passive Income Ideas To Help You Earn Extra Money
- 21 Ways To Make Money Online Without Investment
- Influencer Marketing Hub Instagram Money Calculator
- 21 Ways to Earn 10 Dollars Per Day Online
- 15 Ways On How To Make 1 Dollar Per Day Online
- 11 Strategies To Maximize Your Retail Arbitrage Sourcing
- 15 Effective Ways Of Making Money From Home
- 11 Ways On How To Earn Money At Home Without Any Investment
- 11 Apps That Pay You Money For Using Them
- How To Earn Money From Home: 7 Legit Ways For You To Try On
- How To Make Money Online At Home: 11 Ways To Choose From
- 15 Proven and Tested Ways Of Earning From Apps
- 5 Best Things To Do At Home To Make Money
- 7 Ways Of Making Money from Home For Free
- 9 Legit Ways To Make Money Online in 2019
- 9 Legit Ways Of Making Money From Home
- How Can I Make Money Online From Home: 7 Ways
- What Can I Do To Make Money At Home: 11 Ideal Ways
- 9 Ideas To Make Money From Home And How To Avoid Scammers
- How To Make Extra Money From Home Legitimately
- 14 Ways On How To Make A Living From Home
- What You Need To Know On How To Make Money From Donating Plasma
You may also consider putting up an online business.
For more information and idea about getting into the online business industry, you may want to check any of the following blog posts:
- All About Legging Army Direct Sales Plus 7 Perks of Direct Selling
- 7 Secrets to Succeed On Amazon Based From Amazon FBA Success Stories
- 5 Profitable Business Ideas For Women And How To Do It
- How To Sell On Etsy Successfully: 11 Tried And Tested Tips
- 7 Ideas Of Small Business For Women At Home
- 7 Tips On How To Sell Stuff Online Plus 7 Ecommerce Sites You Can Use
- Can You Sell An Idea To A Company: Your Step-by-Step Guide
- What You Need To Know About Getting Into Local Small Business Jobs
- How To Effectively Sell Craft Online
- How To Become An Airbnb Host In Vancouver
- A Beginners Guide On How To Sell On Poshmark
7. Automate Your Savings
The best tips on how to save money for us is this — make sure to automate your savings. By doing so, you spare yourself from temptations, which the most challenging part of saving money.
By automating your savings, once you receive your income, whatever is left, that’s the only money you can spend, and it’s like forgetting you actually have set aside savings already.
Also, the good thing about automation is that almost all banks offer this kind of service. Also, you get to choose when, and how much money will be set aside.
Trust us, by automating your savings, you will just wake up one day surprised by the amount of money you already have in the bank. Without noticing it, you have reached your money goals for the year or years.
FINAL THOUGHTS ON TIPS ON HOW TO SAVE MONEY
Saving money is not easy – let’s admit it. It’s really one of the most difficult, the most challenging things to do. But, it is also the most important especially if you aim to retire early or you want to have financial freedom.
Saving money is a must not just for the adults but more so for the young ones. In fact, as parents or as adults in general, it is our responsibility to teach the younger generation how to save. Although, as we earlier mentioned, studies have shown that the younger generation is actually better off at saving money, which is very remarkable.
It is nice knowing that the younger generation knows the importance of saving money – that they are working hard to ensure there is enough money saved every time. Also, we find it amazing that in this day and age, there are a lot of different ways wherein we can make more money and be able to save more.
So, how’s your savings so far? Do you belong in the 57% American adults who have savings?