5 tips for saving money this year
Make the resolution to stop living paycheck to paycheck in 2013. Create a savings plan that actually works.
Don’t trust yourself. Savings plans usually suck because they’re only as good as the will power of the person trying to work them—which usually isn’t very strong. Create a savings plan that requires little effort on your part and will, therefore, actually work.
Set a goal. It’s easier to save cash when you’re saving for a purpose. Make a list of a few things (or one large thing) that you want to save money for. This could be getting out of debt, buying a fabulous new camera, or taking a much needed vacation.
Make saving automatic. If you’re the average American, you don’t have the will power to set aside money that you really want to spend. Instead of trusting your self-discipline (fail!) make your savings automatic by scheduling automatic deductions. You can do this every week, bi-weekly, or every month but it’s important to do so consistently. For those who are just starting to save, it’s mentally easier to save in smaller yet more frequent increments (e.g. some believe it is more feasible to set aside $25 every week than to move $100 at once at the end of the month).
Out of Sight. Out of Mind Avoid the temptation to check your savings account frequently. If the money is growing too slowly, you may be disappointed. If it’s growing quickly you’ll be tempted to skip a few savings deposits since you’re doing so well. Once you schedule the automatic deposits, let the money do its thing and only check on it once a month or less.
Don’t carry the card. Isn’t it silly that banks offer ATM cards for savings accounts? You’re supposed to be saving money in the savings account, not spending it. Even if they give you a card, don’t carry it in your wallet. If you’re brave, just destroy the card altogether.