While it s important to take care of expenses and pay your bills, it is also necessary to save money. Even in the uncertain times we live in, where you may feel strapped for cash and sometimes have month left over after the money is all gone, saving is important. The following are some tips to help you manage your money better in these uncertain times and continue or start to save you money.
Comparison Shop for the Best Deals
When I hear “comparison shop”, I think about the time before the internet. Yes there was a time before the internet. Anyway, it is so easy to comparison shop now as opposed to the “good old days” Everyone has a web page where it is quite easy to look and compare prices and deals.
You can even comparison shop banks online. Take a look and see what is being offered by your bank and a few competitors. The idea here is to make sure you are getting the best interest rates you can and that fees and features are appropriate for you.
Have Emergency Savings
If you have an emergency fund great. If not, you need to have an emergency fund and it needs to be in a savings vehicle that is fairly liquid, or place where you could get the funds pretty quickly and easily. Your emergency fund should be equal to three to six month’s worth of your expenses and used for emergency. Having an emergency fund will help you stay on budget and not dip into retirement savings or go into debt borrowing.
Don’t Forget About the Long Term
Saving money for the long term should be a goal of yours. If your employer matches a portion of your savings into a tax-advantage retirement savings plan participate. By not participating you are passing up free money and perhaps losing out on a valuable tax break. Your retirement will be here before you know it.
Don’t Despise Small Beginnings
Consistently saving small amounts out of every paycheck, your savings account will grow and you will be motivated to try to save more. Even spare change that you collect up and then deposit into the bank once a month will add up faster than you think.
Turn Debt into Savings
Once you pay off a debt, such as outstanding balance on a credit card, or if you make that last loan payment on your car, put the money to work as part of your savings. Take that money that used to be a payment and now save the payment. If you do this you will be earning interest and not paying interest with no real change in cash flow.
Pay yourself first
Most people have heard the phrase “pay yourself first”. And the phrase means exactly what it says. When you receive any income, before you pay those variable expenses, commit to putting some of your income into a savings vehicle first. You could do this manually; however, it’s much easier to arrange for an automatic transfer from a paycheck or checking account into a savings.
If you receive a large sum, perhaps from an inheritance, an insurance payment, a tax refund or a bonus at work, plan to deposit some of the money into a savings or investment account before you are tempted to spend it.
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