Saving money is one of the most common financial resolutions people make, but can also be one of the most difficult to keep. Starting a savings plan takes discipline and yes, some sacrifice. With bills, debt and other monthly expenses to worry about, you may easily find yourself living paycheck to paycheck, with little left over to put away. Still, having savings is incredibly important; you never know when a life-changing event like an employment change, the birth of a child or unexpected illness could occur.
There are countless resources out there to take you step by step through how to meet your savings goals, but to get you started, here are a few quick tips you can start doing today.
Pay yourself first. A good habit to get into is to pay yourself each month as though you were paying a regular monthly bill. Map out your monthly expenses and determine a reasonable amount that you can contribute (remember, anything is better than nothing). Make the first check you write each month to yourself, and hold yourself accountable—just as you wouldn’t skip paying your electric bill, don’t skip out on paying yourself.
Set up an emergency fund. While you may want to save for any number of things, building an emergency fund should be a priority. Try to save three to six month’s salary for emergencies only. This way, you have a financial cushion to help you through anything that life throws your way.
Start using a monthly budget. Keeping a budget to track your monthly expenses is a great financial habit to get into; budgeting will help you see how much you spend each month and where you can cut back. As you identify and eliminate unnecessary expenses, adjust the amount you pay yourself each month. It may not seem like much, but little sacrifices now can make a big difference in the long run!
Saving money is something you should commit to doing for the rest of your life. Establishing these good savings habits now will help you lead a healthier, more prosperous financial life for the years to come!