Everyone wants to save up money. But sometimes, it can be difficult to start. No matter how much you try saving up, there’s something that comes up at the last minute, whether it’s an emergency or a bill that needs to be immediately paid for. Don’t let them keep you from reaching your financial goals. Here are a few ways to save up money wisely:
Start a Personal Savings Account
Opening an account is a good way to start saving. Personal savings accounts are interest-bearing deposit accounts in financial institutions. They let you earn a percentage through interest. It can be compounded either daily, monthly, or even quarterly. That means if your interest is added more frequently, the faster your savings will grow. It may not earn you much early on but as time goes by, your interest will eventually grow larger.
On top of that, personal savings accounts can help you curb your spending. Banks and credit unions typically limit withdrawals up to six transactions per month because of the Federal Reserve Regulation D. Should you exceed the withdrawal limit, the financial institution will apply a fee on you. This will force you to plan out your expenses and only use the money you deposited on your savings account only for major emergencies.
Budget Your Expenses
A simple way to start saving money is to organize and budget your funds. This should outline how much you spend compared to what you earn. List all of your fixed expenses, such as your rent, insurance premiums, and car payments. After that, list your variable expenses such as groceries, entertainment, and household maintenance costs.
If you can, cut back on your variable expenses. For example, cancel any subscriptions and memberships you barely even use. Identifying which expenses are more important allows you to focus on what you need instead of what you want. In addition, always check whether you’re still on your monthly budget or if you are going overboard with your spending.
To make budgeting easier, you can just download apps and use websites that help keep track of your expenditures. Budgeting apps such as You Need a Budget and Mint are specifically designed to help you with managing your finances. You can download these apps on your smartphone so you can easily see how much money you have already spent and where you’ve spent it.
Pack Yourself Some Lunch for Work
Sometimes, it’s the little things that count. You may be tempted to always buy takeaways when you’re at work, but in the long run, you will end up spending a lot more on food.
Buying yourself lunch may be more convenient than packing one. But at the end of the month, you’ll be able to save up a significant amount of money with the latter. You can put that money in your personal savings account.
Implementing a Spending Freeze
If you can, try implementing a spending freeze on yourself. A spending freeze is a short period where you’ll refrain from spending on anything unnecessary. You’ll be surprised as to how much money you’ll be able to save at the end of your spending freeze.
Implementing a spending freeze requires preparation and dedication. Pick a reasonable amount of time that you can commit to, and stick to it. If you’re doing this for the first time, it’s best if you limit yourself only for a week to get used to it.
For any amount of you save, deposit it to a bank account without a debit or credit card. Have it on a savings account if you have one. That way, you can make your deposits grow.
Sell Old Items That You No Longer Need
It’s a good idea to sell old items in your home that you no longer need. Decluttering can easily earn you a few dollars, and it will make your home a lot roomier. You’ll be surprised as to how many things are just lying around your house that you can sell.
Collect everything you no longer use and open up a yard sale. Or you can also sell them online via websites such as Craigslist, eBay, and Facebook Marketplace. After your item has been sold, deposit the money into your emergency fund or use it to pay any remaining bills or expenses you still have.
Saving money doesn’t have to be complicated. With dedication and perseverance, you can keep yourself out of any substantial debt and be able to save for the future.