Recs

2

5 Simple Steps to Save More Starting Now

You set reasonable financial goals, and then life happens. You get busy and forget that you intended to invest your tax refund. You keep procrastinating about closing out that old checking account and moving the $300 balance to your new one, and then the fees start racking up. You double pinky swear that you're going to save more from this day forward -- but that's what you said four months ago.

Even the most modest financial goals can get derailed by the day-to-day business of managing life and money. But you can significantly increase your chances of achieving your goals -- and holding on to more of your money long enough so that you can put it to work -- by following these easy-to-implement moves to help you step up your savings a notch or two starting today.

1. Label your savings goals
When you label your savings for a particular purpose, it helps guide your spending decisions and even forces you to plan ahead for incidentals and emergencies. Instead of calling an account the generic "savings," get specific (e.g. label it "kids' college tuition"). When you're planning a vacation, that label should deter you from including those earmarked dollars in your getaway plans. The same can be said for the power of labels to inspire you to set up savings "for emergency use only." You'll certainly see the value of having some money socked away when you have to "borrow" from your vacation fund to fix the transmission on your car or replace a broken refrigerator.

2. Make saving automatic
If you job offers you electronic deposit for your paycheck, see if you can get some of your check automatically deposited to a separate savings account. If not, then talk to your bank about setting up an automatic transfer, and then treat that transfer like a must-pay bill.

3. Save half of your next raise
Salaries are expected to rise about 3% in 2014, and inflation over the past year has been around 1.2%. If that pattern holds true in 2014, and your raise is at least average, you ought to be able to save around half of the after-tax part of it without any impact to your standard of living.

4. Negotiate the interest rates on your credit card debt
If you have a good payment history, your card issuer will want to keep you as a customer. If you don't, your card issuer may be worried that your debt could be headed for a bankruptcy discharge. Either way, it doesn't hurt to call and ask for a rate reduction; you just might be successful. The idea is to get that debt down to zero ASAP. There's little chance you'll out-invest the interest rate you are paying on a credit card. So go for the sure thing and put as much money toward it as you can. The sooner you retire your debt, the sooner you can start saving all that principal and interest that you had been paying to the banks.

5. Budget for fun
Make sure you leave some room in your budget every month for entertainment. It's a lot easier (and more enjoyable) to set aside a little bit each month for entertainment than it is to try to live a Spartan lifestyle and deny yourself all pleasure. Not only will an attempt to cut fun out of your budget likely backfire, but when it does, it will probably be way more expensive than letting off a little steam within preplanned limits.

It's your money -- keep more of it
These are just a few of the ways you can get control of your money, save more of it, and direct more of it to exactly where you want it to go. You work hard for every dime in your paycheck; now it's time to make your money work just as hard for you.

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend-paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor’s portfolio. To see our free report on these stocks, just click here now.


Read/Post Comments (1) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 30, 2014, at 7:26 PM, sevs4u wrote:

    A lot of times it's hard to save; maybe income gets cut, expenses go up, etc. A unique way to save would be to buy a rental property (provided you know what you're doing) and make extra payments toward the mortgage. That way, you can potentially have an income producing property paid off in a relatively short period of time. publicretirementplanners.blogspot.com

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2937022, ~/Articles/ArticleHandler.aspx, 9/16/2014 3:53:32 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 6 hours ago Sponsored by:
DOW 17,031.14 43.63 0.26%
S&P 500 1,984.13 -1.41 -0.07%
NASD 4,518.90 -48.70 -1.07%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes


Advertisement