For our last two blog posts of the month we’re talking New Year’s resolutions dealing with your finances. “Save more money” is the second most popular resolution behind “lose weight/get in shape.” Why? Because, and we’re being honest here, Americans are awful at saving money. In a recent Bankrate survey, less than a quarter of Americans have any emergency savings; two-thirds of those who do don’t have enough. The problem is that we think saving money is hard. Sure, it requires some sacrifices, but with the right plan in place and attitude toward saving, you can have money put away for emergencies. Try this step-by-step plan!
- Be realistic- you don’t have to save everything at once. Consistently saving a small part of your income makes a big difference over time. Get over the mental hurdle that saving money means you can’t spend any. You just have to be smarter about what you spend on.
- Consult your budget and make cuts- examine your budget (you do have one, right?) to see where you can make spending cuts. If you currently eat out three nights a week, trim it down to one, or commit to making your lunch three days a week to save some money. Whatever you cut, place in a separate category of your budget for savings account contributions.
- Pay yourself first- the first thing you should do on payday is put some of it in your savings account. Whether its 10 percent or 20 percent of your income, stashing it in your savings account is priority number one.
- Automate your savings- do you find it hard to make yourself transfer money from your checking account to your savings? Use your Online Banking account to automate your transfers. You can set the amount you want transferred every two weeks, three or however often you get paid. You can’t miss what you never had in the first place.
- Practice delayed gratification- one of the biggest things that kills your budget and savings plan is impulse purchases. Whether it’s something small, like a candy bar at the gas station, or a restaurant meal because you “don’t feel like cooking,” impulse purchases satisfy our need for instant gratification. Relax, think about the money you are about to spend and if it’s really worth it or not.
Saving money doesn’t have to be hard. Yes, you have to be committed to changing your habits and some of your everyday behaviors to succeed. Otherwise, you’ll be back in this same position next year wishing you had saved more money. If you need to open a savings account to put your new savings plan into action, come by your nearest Bank of Blue Valley office or open an account easily online! Bank of Blue Valley, member FDIC