5 Tips to Develop a Money Saving Habit

5 Tips to Develop a Money Saving Habit

With so many things you need and want out there, saving money can be a super hard thing to do. But with these five tips, you may find yourself having a much easier time when it comes to squeezing some extra bucks out of your budget every week. So, do your wallet and yourself a favor and check out the practical ideas below.

1. Start small.

Nobody is born a great saver of money. When you start on your journey to becoming a master money saver, stay away from trying to cut your spending in half in one week. These types of grand gestures tend not to work for very long, especially when it comes to money. Instead, focus on small things. This is a great way to go about it: Save 1% of your income every month. Once you have hit that target, save 1% more next month. Then, add another 1%, so you are now at 3% saved per month. If you keep that up, you will be amazed at the amount of extra cash available to you after just one year.

2. Use automation.

This age is an age of technology. Computers can take care of a lot of things for you already, and saving, as it turns out, is one of these things. Simply set up automatic transfers from your checking to your savings account – for example, of 1% of your income. It will all go automatically and you will be richer for it.

3. Set goals.

How much should you actually save? A good rule of thumb is to go for 3 – 6 months’ worth of salary. That does not mean it is bad to save more, though. Once you are in the habit and it feels right, just keep going!

4. Prioritize.

Make a list of what you need before you shop. Ideally, have a list of what you need per week. Then, stick to that list. Walk right past the lineup of unnecessary junk and focus on your bank account ticking up instead. Remember: Every dollar counts.

5. Perspective.

Do you think getting those $100 shoes is not a big deal? Think again. Imagine how many hours you have to work for that money. If you make $25 per hour, ask yourself: Are those shoes worth 4 hours of your life?

Ian Schindler