Many citizens are living paycheck to paycheck. If you’re working to build up some savings to protect yourself and your family, you may feel overwhelmed by recommendations that include building up months of living expenses. Follow the tips below to set and meet small goals that can spur you on to bigger results.
1. Start Small
Open up a spreadsheet and list out your monthly bills. Maybe you have a $20 renter’s insurance policy or a $10 streaming service that’s your smallest monthly bill. For the first month, put enough aside to cover that smallest amount.
2. Automate Your Savings
Set up a savings account that is easy to load. If someone in your home has a second job, route all income from that job into your online savings account. Pay attention to when the interest from that account loads and track how your earned interest climbs.
3. Start a Side Hustle or Part-Time Job
Sit down and take a hard look at where you spend your time. If you work 8 hours a day, 5 days a week, you actually have quite a bit of time when you’re not working. Can you pick up a job one day on the weekend? Can you spend time each evening working online as a writer or tutor? Can you walk dogs in your neighborhood? Can you deliver prepared food or groceries?
Before you commit to a second job or a side hustle, make sure you set an end date. You don’t want to bump up your spending as soon as you increase your earnings. Work a second job for six months to build savings or wipe out debt, then do your best to live on the income from your full-time job.
4. Commit to a No-Spend
No-spends are a great way to prepare yourself to live on a budget. Before you buy, you need to decide if the item is needed or wanted. If it’s wanted, don’t buy it. If you need the item, confirm you need it now.
Even a week of no-spending can take the pressure off of your credit cards and checking account. It will free up funds to add to savings.
5. Create a Budget
If you’ve struggled to come up with a budget that works, your budget was either too rigid or too restrictive. It’s not a punishment! A well-constructed budget is a great tool.
Use a notebook to track your spending after your no-spend. Write down what you spent and what you bought. Build your budget around your actual spending.
6. List Financial Targets
Maybe your first target is to not pay any more late or overdraft fees. Start a no-spend and shop your pantry and freezer for a week. Only buy what you must have and let your money linger in the bank. When you hit your first financial target, treat yourself!
7. Plan Your Reward
When you hit your first financial target or save enough to pay your first bill, treat yourself. Use a fast food app and get fries or a small ice cream. Meeting your goals and celebrating them will spur you on to even greater success!
Saving isn’t easy, especially if your struggled with financial uncertainty in your formative years. Learning to save sometimes means having to prove to yourself that you can save money!
