This is America Saves Week, and the theme is ‘Set a Goal. Make a Plan, Save Automatically.’ Check out lots of great information at http://texassaves.org/.
Savings Tips and Resources
* Track Your Spending and Cash – Know where every dollar goes.
* Save Bonus Income – Save tax refunds, overtime pay, gift money, refunds and rebates. If not all, put at least part of this bonus income into savings.
* Get health insurance.
* Pay Yourself First – Treat savings like a monthly bill. Deposit money from each paycheck immediately into a savings account (even if it’s just a few dollars).
* Target Savings Opportunities in Your Budget – Pick area(s) of your household budget and make a goal to cut spending in that area by 10% or more. Best target areas – food, entertainment and personal spending.
* Have a “Nothing Week” – Once a month, have a week when you try not to spend any extra money – no dining out, no bowling or going to a movie. Save the money you’d have spent!
* Determine Savings Goals – Make a list of your goals in priority order. Then determine how much money is needed and when. Calculate the amount of money you’ll need to save each month to achieve each goal.
* Monitor Progress – Give your savings plan a check-up every six months to determine its success. Make necessary adjustments to keep yourself on track.
* Break Costly Habits – Bring your lunch to work once or twice a week instead of buying it. Any kind of nicotine habit is just throwing lots of money away, plus you know how bad it is for your health!
* Save for Your IRA Each and Every Week – If not participating in a retirement plan at work, an IRA is a great vehicle for long term savings. Just $38.50 per week equals $2000 a year.
* Make it a Family Affair – Get all family members involved in saving money. Involve everyone in the goal-setting process and challenge them to save money. Put all family members on an allowance and encourage them to stick to it. Monitor their progress as well. Kids as young as 8 or so can be given a “budget”- one mom I know gives her kids a certain amount of money at a restaurant, and if he wants to spend more it comes out of “his” money. It makes a huge difference in what he orders! Kids are also great at “policing” energy usage- making sure lights are turned off, etc.
* Shop With a List at all times – Not just the grocery store.
* Try to Buy with Cash, Checks, or Debit Cards - If you use credit cards, get rid of all but one or two, and pay off the balance each month. You can save hundreds or thousands of dollars a year by avoiding credit card interest charges. If you ARE able to pay off the balance each month, it is so much fun beating the credit card companies at their own game, and earning cash or goods/services “back” and not having to pay any fees! But if you can’t pay it off, stay away from credit cards, except in the case of an extreme emergency (and fashion emergency doesn’t count, ha ha).
Ideally you should have three different savings accounts or one account with three specific categories:
* Emergencies – This account should eventually have enough money to pay your rent/mortgage for 6 months and also make sure there is enough for other monthly living expenses. In the event of an illness or lay-off you’ll be glad you did.
* Periodic Expenses – This savings account is for expenses that occur throughout the year. Calculate your average monthly periodic expenses for the year and set this amount aside every month. Examples include property taxes or car insurance.
* Long-Term Goals – Set realistic goals and timelines for more expensive items for which you’d like to save (house, furniture, college education, etc.). Then put aside money every month towards your goals.