NEWS

4 Ways to Start Saving and Stop Spending

Budget, budget, budget!

Having a budget is a great way to save money. In order to start budgeting, you have to determine how much you spend on the essentials each month. Start with the basics like rent/mortgage payments and utilities. Those are things that usually stay pretty consistent on a monthly basis. Then, look back on old receipts for  groceries and gas. For these, I always like to round up. If you spend $80 on gas every month, budget for $100. If you spend $200 on groceries, write down $230. That way you know you will have enough if you end up spending more. Next, decide on how much you would like to save every month. The rest is what you have left to spend on yourself. I tend to go with the 2/3 rule. If I have $400, I try to only spend 2/3 before I get my next paycheck. That way, your checking account will accumulate each month, and you won’t be living “paycheck to paycheck”.

Take advantage of direct deposit

One great way to save money is have it automatically put into your savings account every month. Most employers who have direct deposit can also deposit part of your paycheck into your savings account. You can either choose a set amount, like $50 a week, or a percentage, like 3% of your paycheck. That way, you won’t even know that you had the money to spend in the first place!

Save for those unexpected charges

Although it is nice to look at life through rose colored glasses, it is not always the smartest way to live. If you have a huge unexpected expense and no money to pay for it with, you could find yourself in a pickle! With no emergency fund, the bill could get sent to collections. It would inevitably affect your credit score, making it harder to get loans or rent an apartment. If you have an emergency fund, you can use the money to take care of things like paying off a medical bill and replacing the transmission for your car.

Use the 24-hour rule

Do you find yourself spending money on something and then saying, “Why did I buy that?” a couple days later. Don’t worry, you’re not the only one! If you want to stop spending money on nonessential items, use the 24-hour rule. Think about the purchase for 24 hours. If after a day it doesn’t seem to spark joy, don’t buy it!