Seven Tips for Saving Money

For a large majority of the American population, once all of the bills are paid and the essentials are purchased, there is little to no money left over between paychecks. In fact, studies have shown approximately 24 percent of consumers do not have any emergency savings.

But unexpected situations do arise requiring extra funds, from broken home appliances and car accidents to last-minute doctor’s appointments, making it extremely important for you to learn how much you should be saving and understand the best ways to go about doing it.

How Much Should You Save?

There are numerous opinions on the appropriate amount of money you should be saving each month. Some experts suggest you should save 20 percent of your income, with the other 50 percent going to your essential expenses and 30 percent being used for discretionary purchases. But not everyone can afford to save that much money.

The amount of money you have the ability to save is directly influenced by the amount of money you earn versus your monthly expenses. And therefore, every person’s saving habits will vary.

The important thing to remember is to start saving as much or as little as you can. Every dollar counts and the more proactive you are about saving now, the easier and more routine saving will be for you in the future.

Seven Simple Tips for Saving Money

With the advent of credit cards and loans, many people have gotten so used to paying later, they do not realize how much money they are actually spending. This has not only lead to a society where saving is no longer the norm, but has also put a lot of people in bad financial situations.

Fortunately, there are a few easy ways to save and keep saving. Here are a seven simple tips for saving money:

  • Automatically deposit a portion of your paycheck into your savings account. Most banks allow you to do direct transfers, bill pays and deposits, taking the hassle out of your hands.
  • Sacrifice; it is the key to saving. Even though you have money left over after expenses, this does not mean you should spend it. Save it for a rainy day.
  • Avoid impulse buying. Many times, if you wait a day or two before making a purchase, you may realize you do not really need the item.
  • Pay your bills on time to avoid late fees. Charges caused by late payments can add up very quickly and can usually be avoided.
  • Be aware of overdraft fees charged by your bank account and credit cards. Keep track of how much money you have in your account and how much is schedule to come out each month.
  • Avoid credit cards with annual fees. There are plenty of cards available that do not charge unnecessary yearly fees; the key is to be cognizant of them.
  • Keep track of your savings. If you set a goal as to how much you know you can save within a given timeframe, it will help you pinpoint where you need to cut back on expenses and give you something to work toward.
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