During this time of year, many of us have exhausted our extra resources on Christmas. You may be looking to save money in the near future. When it comes to developing a personal savings plan, little things mean a lot. These little things are more important than ever because American savings habits don’t look good. On average, Americans are spending more that they are taking in and saving nothing. Therefore, debit is on the rise. A recent study, commissioned by Consumer Credit Counseling Service, revealed that overall consumer debt has increased by 38 percent for households at all income levels over the past year.
Let’s face it, saving money isn’t easy, but it doesn’t have to be that hard either. Establishing a personal savings habit and becoming debt free can be done. Watch your daily spending habits and determine where you can pocket money instead of spending it. For example, buy store brand items instead of name brands when shopping for groceries and order water instead of soft drinks or tea when dining out. Other ways to start small, but save big are:
– Drink regular coffee instead of expensive coffee drinks.
– Bring lunch to work instead of buying lunch out every day.
– Dine out one less time each month.
– If taking prescription medications, ask about taking the generic versions and then shop for the lowest-priced pharmacy.
– Reduce credit card debt and be sure to make payments on time. Late fees can add up.
– Keep your car tuned and its tires inflated to the right pressure; shop around for the cheapest place to buy gasoline (hard to imagine cheap gas anywhere right now, but even a few pennies a gallon counts).
– Shop for clothing at discount and outlet stores and resale shops. You can find lots of great bargains on gently used clothes. Many resale shops also have new items and a discounted price.
– Give up premium cable channels and rent movies instead.
– Borrow books from the library instead of buying them.
– Save loose change and dollar bills. My husband and I save our change and dollar bills and put the money into a savings account for our kids. We usually end up with $400-$500 a year. Believe me, it adds up. This could also be used for vacation, Christmas, etc.
– Keep track of spending and review spending habits every month.
– Never make big purchases on impulse. Think about it for at least 24 hours.
None of these steps require life-impacting changes but they can help you grow wealth. These savings can be used for retirement or college funds, major purchases such as a home, car or vacation, or as a financial cushion in case of emergencies. The key to any savings plan is to “pay yourself first.” Set money aside every month before you are tempted to spend it. Save before you even pay your bills. If you are living so close to the edge that you pay your bills and have nothing left to save, you are in deep water. The whole concept of paying yourself first is basic to developing financial skills and growing assets. If you don’t pay yourself first, you are never going to save money.
