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Money-saving challenge: A saving plan that works

Saving money is difficult. Really hard. But the rewards are sweet when you make the effort to make it happen. There is no passive strategy for saving, but when you choose to take action, there are several options that will get you on the right track to see your savings grow.

Step 1 – Start spending less

As the saying goes, “A saved penny is an earned penny” so every small amount you can save instead of spending adds money to the right column of the spreadsheet. It helps to change your mindset from “It is only $ 5 or $ 20 or $ 1

00, “to” It is Other $ 5 … ”

Skip the Starbucks drive and make coffee at home instead. Search for promotional codes when shopping online. Take advantage of happy hour at restaurants, usually between 3pm or after 9pm. Divide the meals or cut out the drinks when eating out.

Review your bank statement for the past three months to find out exactly where your money has gone. Then critique the line and shave wherever you can. Set up carpools for yourself and the kids to save on gas. Call your insurance agent for an annual review of car and home insurance premiums. Disconnect cables, Netflix, Amazon Prime, lawn and cleaning services until your debt is paid.

Shave $ 5 here and there and you will be amazed at how quickly it adds up. Make it a challenge for yourself and your whole family to see how much you can save in one week. $ 5, $ 100, $ 200? Set short-term goals that can be achieved so that you see your successes along the way. Remember that when you can get your savings where you want them, you will probably be able to put back into the purchases and splurges you like now. In other words, you do not have to tighten the reins forever, but the more seriously you work towards it, the faster you reach your goals.

financial bank registers for one month

Step 2 – Start small

Start by getting a month’s rent or mortgage in savings. This will give you a pillow if something comes up. Give yourself time. If you are like most people, you live paycheck to paycheck so that a month’s housing payment may seem insurmountable. However, you will get there. Just keep an eye on the price.

Step 3 – Pay off the debt

hand cut a credit card with scissors

It’s not fun, but if you have a credit card, car loan or hospital bill, you get paid. Leave your initial money in savings and put every other extra kroner against debt. Succeeding goes back to step 1 when it comes to spending and savings. If you return an item to the store and receive a refund of $ 12, go online and make a payment of $ 12. If you receive a refund or incentive check, transfer the amount to your debt.

Keep relentlessly focused on paying off debt. It does no good to pay interest on loans while you have money sitting in the bank (earning a few cents a month) so you need to get past this step to really benefit from savings.

To see your progress, funnel all your extra payments onto a loan. When you pay it, do a party dance and then roll the payments you paid on that debt towards the next loan on the list. Soon you will be making large payments against your debt while saving significantly on interest payments.

Step 4 – Set up Autosave

person using his phone and laptop for online banking

Once you have paid off all the debts except the student loan and your mortgage, you start depositing extra money into your savings account. This is what you have been working towards so do it automatically and long term. Ask your employer if they offer split deposits. They often deposit an amount you request to check your bills and any extras directly into your savings account.

If your employer does not offer it or if you manually deposit your checks, they can take care of it in the field. Another option is to create an automatic transfer with your bank or credit union. Choose a date in the month and an amount for automatic transfer from checking in savings. Another clue is to set up your savings account in an online bank or other institution that is separate from your checking account. When your money is difficult to access, you are less likely to spend it and improve your chances of increasing your savings.

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