5 Tips to Start Saving
February 28, 2014 | By fischer |
Are you a saver or a spender?
Savers love to save and even get excited about the prospects of having money put aside. Unfortunately, many of us fall into the spender category.
If saving money doesn’t come naturally to you, you are not alone. Many spenders find the idea of trying to become a saver daunting, but it doesn’t have to be.
There are some very simple steps you can take to become a saver. Attending to these few changes now can pay big dividends later, and help you to develop an appreciation of saving.
5 Tips to Start Saving
1. Know where your money is going
This sounds simple, and it is, but it is one of the biggest impediments to becoming a real saver. If you don’t know how much money you have coming in and going out each month, how can you begin to know how much you can put into savings?
Sit down and take a look at your income and your expenses. Do you always seem to have more money going out than coming in? No extra left to put away for a rainy day? The solution is a simple budget.
Write out a list of your outgoing payments and bills each month and compare it to your income. If you are spending more than you earn you are heading for trouble.
2. Trim the fat
Once you have a budget, look at ways you can reduce your spending in order to save more money. If you are in the black every month, that’s great. That’s all money that can be put into savings. If you need to make some changes, be honest with yourself about it.
- Do you really need a gym membership?
- Do you overspend on fast food and restaurants, but still spend a fortune on groceries?
- Are you paying a fortune for cable television you rarely watch?
Some overspending is obvious, especially if you are a shopper. Other overspending, like paying too much for your insurance or cable television, isn’t as easy to spot.
Drop any memberships you don’t use, and shop around for lower payments on things like insurance and cable. You’d be surprised how quickly the savings add up when you make small changes like these, and it only takes a little effort.
3. Reduce debt
If you have debt, especially high interest credit card debt, work hard to clear it up as quickly as possible. All of the interest that you are handing over to the credit card companies each month could be going into