We are mid-way through National Save for Retirement Week so it makes sense that it’s also “Brown Bag” your lunch day. There is no shortage of “how to save money” blogs on the internet and maybe I am just feeding the beast by offering my five tips. But the good news is, there ARE thousands of articles out there about saving. So whether you are focused on saving for your “Life After Work” or have other goals like saving to pay extra on your student debt or saving for the down payment on your first home, there is never a shortage of tips to help you along the way. Just pick a few that you like and start saving!
- Remove yourself from alerts: It’s hard to resist the temptation of shopping when every day you are receiving emails and text messages about the next “can’t miss” sale. Shut down the impulse noise to keep your budget on track.
- Make it a competition: My husband and I follow the Dave Ramsey Cash Envelope System. We take out a certain amount of cash each week that we allocate for our own personal use. We call it our “fun money.” But we still found ourselves putting some incidental purchases on our cards that caused a lot of budget leakage. So we now have a bet. We can only make purchases with our “fun money” cash. Whoever puts any “extras” on the debit or credit card has to treat the other person to dinner and pay for it with their “fun money.” The thought of losing a bet to my husband is a great motivator to keep the plastic in my purse.
- Auto deduct to increase savings: I know you hear this all the time, but if you haven’t automated transfers to your savings account yet, then you need to hear this one more time. I have several savings “folders” (gifts, sports, school, clothes, etc.) in an online bank account. Each month I automatically transfer a certain amount into each “folder.” It doesn’t have to be a huge amount and the savings quickly adds up. Now, when I am caught off-guard by my son’s growth spurt, I don’t have to raid my budget to buy new clothes. And for your retirement specifically, make sure you enrolled in your retirement plan at work. Once you are, all contributions come directly from your paycheck automatically.
- Exchange benefits with friends and family: Think about what friends and family have to offer that you can take advantage of or exchange favors for. My brother is an Amazon Prime member. He was able to add me to his account for free. Now I get Prime benefits without the cost. Do you know someone that has season tickets to a sporting event or the theater? Offer to do a good deed for them in exchange for tickets.
- Place a value on your purchase: I don’t mean a monetary value; I mean an emotional value. You obviously have some saving’s goals, otherwise you wouldn’t be reading this blog. So before you make any purchase that is outside your budget (even that yummy hot chocolate with the frothy whip cream) ask yourself “How is this purchase furthering my savings goal?” or “Is there a better way I could be using this money?”. For more on this topic read this insightful NY Times blog, “An Essential Budget Query.”
You don’t have to save monumental amounts out of the gate. It can start with just a dollar, as explained in our blooom blog “The Dollar-A-Day Challenge.” The biggest lesson to take away from this week is to just start saving for your future.