Saving money can be an exciting challenge. When you have something in mind, it gives you focus, reducing the temptation to overspend and making you more aware of where your money is going.
Of course, there are obstacles along the way. No matter how much you need to save and for whatever reason, these tips can help you reach your savings goals.
Set realistic short and long-term goals
If you want something specific, start by working out how much you’ll need and by what date. Combined with what you already have saved up, you should be able to see the amount you’ll need to save each month to achieve your target.
Based on your income and current outgoings, you’ll have a good idea about how realistic this is and if you need to adjust the timeline. Factor in saving a little extra each month, in case any unexpected bills or other surprises crop up.
When you’re generally just saving for the future, look at how much you have left after paying your monthly bills. This will be the maximum you could save but be realistic, as you can’t save every spare dollar. Set a short-term goal for three or six months, then build up the amount and time you save if you hit your targets.
Review and adjust your budget
It’s likely your financial position will change when saving, especially with a long-term goal. Hopefully this will be positive with a pay rise but it could be negative with an unexpected large bill. That’s why it’s important you regularly review your budget, goals and financial position, to stay on track.
Check the value of what you’re saving towards as well. This can change over time, especially for big ticket purchases like a car, house or vacation. You may find it necessary to adjust your budget to accommodate such changes.
Look for other opportunities where you can cut things from your budget – such as a gym membership you no longer use, for example.
Use the right savings tools
There are all sorts of tools and accounts available that can help you save. Setting up a standing order from the account where your paycheck lands to your savings account will ensure you don’t forget to save each month. Think of it like an extra bill – one you’re paying to your future self.
It’s rare that everything goes to plan when saving, so prepare to be flexible. Don’t panic and give up if you miss your target one month, you can always get back on track. When reviewing your monthly budget simply increase the amount to save next month to make up for it.
Take a look at other savings accounts and options too, as new ones that offer a better deal can crop up all the time. Switching could see your interest increase to cover any setbacks you experience in previous months.
Despite having a specific goal in mind, it can still be easy to slip into your overdraft or savings. Use a Kroger Reloadable Prepaid Debit Card to avoid using an overdraft and damaging your savings plan.
Add the amount you have left to spend – after bills and your savings contribution – each month. You won’t be able to spend more than the funds you’ve set aside or go into an overdraft.
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