Inside: Find out how to use some simple strategies to increase your savings and give your accounts the boost they need.
You know you should be saving more money, but for some reason it does not happen. It is hard. There is not enough money. You forgot. Maybe next month. We are all too familiar with the excuses.
And you even know why you should be saving more money. You know you will need money in retirement. Heck, you would even be happy just to have the ability to cover unexpected expenses with less stress.
You are not alone in wanting to save more, yet struggling to do so. Americans as a whole are bad at saving money. As of November 2016 the personal savings rate in the US is only 5.5% . What is a personal savings rate? It is the percentage of your income you save. Right now, for every $1,000 in take-home pay, the average American is saving $55 dollars towards retirement, emergency savings, or special savings fund.
There are steps you can take to boost your savings and make saving easier. No matter how little or much you make, these are ways to help you reach financial independence.
Set a goal
It seems rather boring to just plunk $200 in an account once a month. But if you have a goal for the money, it is more exciting to watch the balance grow.
That $200 could be going towards financial freedom and early retirement. It could be building up your emergency fund so you aren’t as stressed about car breakdowns. The money could be going towards that dream vacation in Aruba.
Having a goal to focus on makes it easier to stay on top of your saving plans. Set a goal and a target date to help motivation.
You can start saving more by having the money automatically tucked away before you even see it. Have part of your paycheck auto-deposit to a separate savings account. If you are already doing that, try increasing the amount a bit.
Also, if you are not contributing to your company 401(k) or similar plan, do that. It will be automatically deducted from your paycheck.
Use a second bank
You might think having an account at a second bank is inconvenient. That is the point. If you keep your savings at a bank separate from the account(s) you check frequently, you are less likely to touch the money. Keeping your savings at another bank also makes it harder to transfer money over to your normal checking account.
Get a raise
Are you paid what you are worth? Check what the average salary is in your area for your job. If you aren’t getting at least the average wage, it might be time to put together a case for a raise. If that fails, you should shop around for work at another company that will pay more.
Save your raise
When you get a raise or bonus at work, keep your normal budget and standard of living and save the extra money. You will soon be saving far more than many of your peers and can enjoy years of compound interest on those savings.
You can boost your savings by earning a bit of side income. Maybe you can do some consulting, give music lessons, do some bookkeeping, yard work, or sell crafts. Those side hustles could easily bring in a couple hundred dollars a month.
Do you pay off your credit card in full each month? If so, check to see if your credit card offers cash back rewards. If so, use the credit card more than debit to rack up the rewards, then use those to boost your savings.
Save the change
Saving your change won’t turbo boost your savings, but it does help. You can set out a jar and every day, drop in any spare change you have picked up. When the jar is full, take it to your bank and deposit it to your savings account.
It is hard to save money if you do not know where your money is going. If you are having trouble saving, start tracking your spending and set up a budget.
Once you know where your money is going, you can cut unnecessary spending. Maybe it is the workday lunch you buy, a too-expensive plan on the cell phone, or the cable bill. Whatever items you cut from your spending can now be put into savings.
These savings boosts should help put you on the path to better financial health.
How have you managed to boost your savings?