Four Tricks to Save Money

Are you finding it impossible to increase your savings account with the cost of living increasing and your paycheck staying the same? Try these tricks and see if they help you put a few extra bucks into savings each month.

Automatically Deduct into Savings
Log into online banking or head into your local branch to set up a recurring transfer from your checking account into your savings account. If you set this to occur on the day your paycheck hits your account, you shouldn’t miss the money. Try shooting for an amount that you would normally spend on a dinner out, or on something you are willing and able to cut out of your budget. If possible, try to transfer out 30% of your salary and use the remaining 70% for essentials. You may find this difficult at first, but will eventually adjust to a smaller budget and will be able to distinguish between essential and frivolous expenses.

Pay Cash
Credit cards are useful for building a good credit history that can help you secure loans when you really need them. However, many people end up using their credit cards at any opportunity, without even thinking about whether or not they will have the money to pay the bill off in full later. Try using your credit cards only for buying expensive but essential items. New appliances, for example, are things you need but can’t necessarily pay for in cash. Get into the habit of paying for things in cash, especially if it’s a small expense. In addition, when you are paying off your card each month, pay more than just the minimum balance so you’re chipping away at the principle due instead of just the interest.

Set Financial Goals
It’s easy to make a goal to save more money this year, but it’s more difficult to commit to these hopes if you don’t have a concrete plan for achieving your aims. Set realistic and specific goals. Just wanting to save money isn’t enough, but committing to saving $300 each month or $2500 this year is a great start at setting goals that are trackable. Breaking these goals into smaller to-dos will help you set a savings plan that is successful.

Use your 401(k)
If you have a retirement account available from your employer, use it! The money you invest into this account is deducted from your paycheck before taxes – meaning you may see your overall taxable amount decrease depending on how much you are contributing pre-tax.