Has it been a week already? Time flies when you’re learning how to rethink your approach to a more sustainable financial future, right? So, last week we went over how to be more intentional about spending money. Intertwined within that lesson were some choice bits of wisdom around arguably one of the hardest aspects of financial wellness – saving. The bottom line is that saving money is hard. It’s hard because spending money can be so easy and gratifying at the same time. Saving money, on the other hand, can feel like a slog and certainly doesn’t give you that instant gratification we’ve all become accustomed to. This is precisely why changing the way we think of saving can have a massive impact on how well we’re able to do it. So, sharpen those pencils, make sure those calculator batteries have been replaced, and let’s jump into another installment of Financial Health 101 and learn about how we can start to uplevel our savings skills.
Hello budget, my old friend
So, you’re probably getting tired of hearing us talk about budgeting so much but it’s kinda one of the most important parts of any sound financial plan. We’ve already talked about how budgeting can help you get a better grasp on what you’re spending and how much you have left over each month after necessary expenses. What you should begin to think about now is how much you’re able to put aside in savings each month without it feeling like a burden. Would it be great to save 50% of your paycheck each month? Of course it would, but if you’re barely scraping by and surviving only on packaged ramen and refusing to use your heater in the middle of winter in order to do that you’ll be miserable. As with all things finance-related, balance is the key to any harmonious strategy. Find a number that feels right for you to put away each month that still allows you to enjoy yourself and not feel like you’re completely deprived of the things that are important to you.
Saving is a lot like going to the gym. You can show up every day and hit a bunch of different machines and free weights but if you don’t have a tangible goal you’ll never see real results and waste your time. If your goal is to bulk up to The Rock levels of muscle mass, walking on the treadmill for 45 minutes isn’t going to help get you there. Saving money is the same. When you have a real goal in mind, putting money aside becomes infinitely more manageable. Are you trying to pay off your student loans in the next few years? Saving up to buy a new car? Trying to get your emergency fund to a more comfortable place? Knowing why you’re saving will help not only keep you motivated but also give you a better idea of what you need to be setting aside each month. Additionally, your savings goals can also help determine the best way to start saving your money. If you’re looking to maximize your retirement savings, accounts like 401Ks and IRAs are excellent long term savings options. If you’re just trying to put aside some money for a new computer or a vacation, then shopping around for a simple savings account with the highest savings percentage might be the best option.
One awesome benefit of banking these days is that you can take care of almost everything directly from your smartphone. Use this to your advantage to set up automatic transfers directly into your savings account. Time the transfers with when you get paid and you’ll never have to lift a finger again as the savings start to build. An added benefit of this method is that once you set it up you’ll probably forget about it in a few days time. It starts to almost feel like a passive income stream finding its way into your savings account every month.
Death by 1000 subscriptions
We’ve mentioned it before but one of the best ways to start saving more money is to stop spending so much money. Monthly subscriptions are a huge drain on your income and it’s not difficult to figure out why. The allure of a service at only $9.99 a month sounds like nothing at first blush. The problem starts when you have 10-15 subscriptions you’re responsible for every month. Take a moment to take stock in what you’re subscribed to and determine which services are must-haves and which ones you can part ways with.
Would you look at that, we’re already out of time! Another week, another chance for us all to get more intentional with the way we think about our own financial health and wellness. Saving money can certainly feel like one of the more difficult aspects of financial health but proper planning and taking advantage of some of our more modern creature comforts can help make it all seem a bit less daunting. That will do it for today’s lesson, everyone. See you next week when we tackle debt!