4 Savings Tips That Actually Work

Want to boost your cash reserves? Here's how.

We all need money in savings -- for emergencies, life goals, and even fun stuff, like vacations. But building your savings is easier said than done. We all have bills to pay and unplanned expenses that pop up and thwart our efforts.

If you've struggled to save money in the past, don't give up. Maybe you just need to take a different approach. Here are a few tips that could increase your chances of success.

1. Put everything on autopilot

It's much easier to save money when you're effectively forced to do so. And the way to make that happen is to set up some automatic transfers. First, you can arrange for a portion of each paycheck to transfer automatically from your checking to your savings account. That way, you won't get an opportunity to spend it. You can also sign up for your employer's 401(k) plan and have money deducted from your paychecks off the bat for retirement. And if you don't have access to a 401(k), you can open an IRA with an automatic savings feature and do the same.

2. Set reasonable goals

If you generally save anywhere from $0 to $50 a month, you can't expect yourself to suddenly start saving $500 a month. A big part of saving successfully is setting reasonable expectations. In this example, starting with a monthly savings goal of $100 or $200 could be a better bet. That way, you're less likely to fail, get discouraged, and stop trying.

3. Reduce one expense at a time

Some people decide to get serious about saving money and then go on a major expense-slashing spree. That may be effective for a short while, but on a long-term basis, it's just not sustainable to cut out all luxuries. After a few months, you're likely to crack and give up. A better approach? Tackle one spending category at a time. Spend less on takeout one month. Cut back on clothing purchases the next month. And the month after that, cancel a streaming service you rarely use. If you do things gradually, you're less likely to feel overwhelmed, which means you're more likely to keep up your savings efforts over time.

4. Bank all windfalls

Chances are, you'll manage to get your hands on some extra cash in the course of the year. Maybe you'll get a tax refund from the IRS. Maybe another stimulus check will come through. Or maybe you'll finally be rewarded for your efforts at work with a generous bonus. Either way, that extra cash can serve as a prime opportunity to pad your savings, so resist the urge to spend it.

Let's face it -- saving money generally isn't as fun as spending it. But if you don't build some savings, you could experience some major financial headaches down the road. You risk racking up debt when emergency expenses strike. You may also miss out on opportunities you may want for yourself, like buying a home. So it pays to push yourself to save, even if that means giving some things up along the way. In fact, once your savings reach a healthier level, you may find the peace of mind it brings will more than make up for the sacrifices you endure to get there.