Four Practical Saving Tricks That Actually Work!
Most of us dream of having a bigger bank account, but at the same time, most of us are clueless about how to reach this milestone. When it comes to maximizing your savings, there’s no one-size-fits-all strategy. Your income, your lifestyle, and your preferences are unique. This implies that your financial goals and your abilities to reach your financial goal are totally different from others. If you are still looking for the best savings methods that still work, here are four pithy tips for you:
Save A Fixed Percentage Of Your Monthly Income
Saving a certain percentage of monthly income is often perceived as a retirement savings strategy, but people of all age groups can adopt the same strategy. This works best for people who do not have a fixed income. If you have a variable cash inflow, committing to set aside a certain amount of money might be difficult as your pay may hit the floor. Instead, you can save a fixed percentage of your monthly income. If you do this, no matter what you earn every month, you will be able to save at least some amount of cash every month. If you have more than just one saving goal, you can break down the goals not by amounts, but by percentages. For instance, you might put 5% in your emergency fund and another 5% in your retirement savings fund.
Save A Specific Amount Within A Predetermined Time Period
This is indeed a very popular and fail-safe method of maxing out savings. This tip has gained popularity as it can be automated easily using various personal finance management apps. If you can save a specific amount of money within a predetermined time period, you would easily be able to reach your saving goals. The key difference between saving a certain percentage of your income and saving a set dollar amount every month is that you don’t have to work out the actual amount you need to save at the end of every month. Instead, just let your app know what amount you want to save every month, set the amount, and forget about it. Instead of saving a set amount on a monthly basis, you can also break it down to a weekly basis or per paycheck basis. For instance, if you want to save $500 every month, you can simply start saving $125 every week.
Save Virtual Change
Throwing coins in that big fat piggy bank has been a common saving trick for many. However, since electronic transactions are gradually replacing cash transactions, saving changes this way might not be quite effective a few years down the line. You can also start saving your virtual changes. Here’s how to do it. While making a purchase online with your debit card, round up the purchase amount to the nearest dollar amount, and set aside the difference in your saving account. There are several apps to help you do that. In fact, Bank of America and other big banks have started offering ‘save the virtual change’ feature as one of their add-on services to their account holders. It’s only a matter of time before other banks follow their suit.
Take Part In A ‘Save Money’ Challenge
If you want a bigger bank account, you just need to go out of your way to get into the habit of saving. Money-saving challenges are aplenty, and you can try any or all of them to increase your savings. For example, you can start saving all the $5 or $10 bills or save every bill which is greater than your present age. The 52-week saving challenge has also helped many people to multiply their savings. In this challenge, you have to save $1 for week one of the year, $2 for week two, and if you can keep saving this way, you will end up accumulating $1,378 at the end of the year. There are many other fun money-saving challenges which are highly effective as well. Just choose one that you feel you can do and take the challenge head on!
Personal finance is one area where we all have our own set of preferences. In case you still have not been able to find a money-saving method for you, you should not stop trying different methods. As a last resort, you may take help from a personal finance manager.
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