Suze Orman Has These 3 Tips for Boosting Your Savings

It pays to take her advice to heart.

You'll often hear that it's important to have a nice chunk of money set aside for emergencies. In fact, a good rule of thumb is to have a minimum of three months' worth of living expenses in your savings account. And financial expert Suze Orman actually thinks your emergency fund should have enough cash to cover eight to 12 months of essential expenses.

If that sounds like a tough goal to meet, well, that's understandable. Unless you earn a really generous salary, the idea of socking away enough cash to pay for eight to 12 months of bills can be daunting.

But if you think your savings could use a boost, it's important to focus on that goal to give yourself the financial protection you need. And in a recent Motley Fool podcast, Orman shared these three tips for giving your savings a nice bump.

1. Live below your means

If you want to boost your savings, you can't spend every penny you earn. It's that simple. And so if you're committed to growing your savings, you'll need to find a way to live below your means. That could mean moving to a less expensive home, unloading a car with a $600 monthly payment in favor of one with a $350 payment, or cutting back on non-essentials, like concerts, trips, and clothing purchases you don't need for work.

2. Differentiate between wants and needs -- only buy needs for six months

In grade school, we're often taught the difference between needs and wants. But many of us somehow forget that essential lesson as we get older. Orman insists that a mental refresher on needs versus wants could be the ticket to saving more money.

For example, Orman says, you need to eat, so it's okay to classify grocery store purchases as a need. But you don't need to eat at a restaurant, where you're apt to be charged a huge markup on the food you consume. If you're able to differentiate between needs and wants, and then commit to only buying the former for a period of time -- say, six months -- you might make huge progress as far as your savings efforts go.

3. Get as much pleasure out of saving as you do spending

Indulging in things like takeout meals, designer clothing, and store-bought coffee might bring a lot of people joy. But Orman insists that to succeed at saving money, you need to learn to get as much happiness out of saving as you do out of spending.

It's important to reward yourself mentally for meeting different savings milestones. And you can even attach modest rewards to different thresholds. If your savings account needs another $5,000, you might, for example, treat yourself to one takeout meal or small purchase for every $500 or $1,000 you save.

Saving money isn't easy. But if you need to ramp up, then it definitely pays to follow these tips from Suze Orman -- because if anyone knows a thing or two about building wealth, it's her.