Seven Tips for Saving Your Money

Most financial experts agree that it is best to have at least six months of wages put back in case of an emergency. But few Americans have even two weeks worth of pay saved up. In fact, according to CNBC, about 69% of Americans have less than 1,000 dollars in the bank. That means, if they were to lose their job today, they would be facing a serious financial emergency right away. Luckily, it doesn’t have to be this way though. By using the following seven tips for saving money, anyone can build up their savings account to a higher level, so they can stop living paycheck-to-paycheck.

Create a Budget

Before making any financial adjustments, it is always best to start by creating a budget that includes all of the current expenses in it. That way, it is easier to see which of them can be reduced. It helps to show the total monthly income at the top of the budget and the ending balance after everything is paid at the bottom. Don’t forget to include the dates that the bills are due since this determines the payment schedule.

Determine Your Savings Goal

Once the initial budget is made, take a look at the beginning and ending balances to determine a realistic amount of money that could be saved each month. If it doesn’t seem like enough, look through the list of expenses to see which ones can be reduced. This can be done more easily if they are listed according to whether or not they are fixed or variable expenses. Fixed expenses are not flexible. They are bills with the same amount each month, such as the rent or mortgage. But variable expenses change. An example of them is the amount spent on groceries or gas.

Start With Simple Changes

To ensure the greatest chance of the new budget working, it is best to begin with small, simple changes. For example, a person could switch to using an antennae to watch television at home instead of having a monthly cable or satellite bill. Or they could start packing their lunch for work each day rather than buying a meal at a restaurant.

Drastic Measures

Sometimes, after a budget is created, a person may notice that the reason that they have so little money saved up is because they have more expenses than they do income. This means that more serious steps will have to be taken in order to save money since the bills still have to be paid first, such as taking on a few extra shifts at work a week. Or a person may need to switch jobs, so they can earn more money. When neither of those are possible, small, part-time ventures can help, like offering to babysit for extra cash or selling unneeded household items in a garage sale.

Stick to Cash

Letting go of cold, hard cash is a lot more difficult than simply swiping a debit or credit card because it is easier to see it dwindle down in front of your eyes. So try setting the debit and credit cards aside for a while.

Negotiate Your Bills

Many companies offer flexible payment options, which allow for lower interest rates or better payment terms for folks who are struggling to get ahead. The only way to find out about them is to ask though. So try calling all of your creditors to see if they are willing to negotiate.

Make it a Team Effort

It is much easier to save money when everyone is on the same page. So it helps to make budgeting a family affair whenever possible. And, as an added benefit, it will teach children to make responsible financial decisions that will help them later on in life when they are older.

As you can see, saving money requires hard work and determination. But as long as everyone in a family sticks together, it is possible for anyone to achieve. Those who have an enormous amount of debt may need some extra help and guidance though. So be sure to contact a financial adviser if you are struggling with the budgeting process.

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