Tuesday, 15 March 2016

Saving money is always a smart idea, whether it's for emergencies, education, or retirement.

But saving money can be easier said than done. In fact, nearly half of Americans have no savings at all. There are many simple ways to cut down on costs, like taking your lunch to work, skipping the pricey coffee, and turning down your thermostat.

But spending less is only half the battle, and actually getting the money into a savings account can be just as challenging. Here are five real-world ideas for getting your money into a savings account—and keeping it there.

Pay yourself first

You've probably heard of the concept of paying yourself first. Before you pay any bills or buy any groceries, set aside a portion of every paycheck you get. Even if it's only $25 a week or a month, you're saving money, and most banks make it very easy to set up automatic transfers. Having money automatically transferred out of your checking account and into a savings account is a great way to make yourself save.

Another great way to automatically save is to enroll in any retirement savings program your employer may offer, like a 401(k). This type of saving is even more beneficial if your company matches any of your contributions—which is essentially free money. What's more, the money you save is pre-tax, which ultimately reduces your income tax bill. Even though this is long-term saving, it's still saving.

Save bonuses, raises, and windfalls

Many people usually have the tendency to celebrate raises and windfalls by spending money. In some cases, we actually end up spending all—if not more—than the original amount we received. If you get a raise, increase your automatic savings transfer by that amount, even if you're just making ends meet. Since you've proven to yourself that you don't need it to live on, why not save it? The same can go for bonuses, refunds, and other unexpected sources of incoming cash.

You can avoid the tendency to overspend and boost your savings account at the same time by directing all this bonus money into your savings.

Hide your savings

It can be helpful to send your automatic savings contributions to an account you can't easily access. Think about opening a savings account at a bank where you do not have your primary checking account.

By law, savings accounts—including money market accounts and the more common savings accounts—limit the number of withdrawals you can make per month. If you're not careful, all it takes is one quick online banking transfer to derail your savings plan. Consider declining to sign up for online banking for your savings account. This can make it harder to raid your savings account when temptation hits.

Keep paying down debt

If you're about to pay off your car loan completely, that means you're about to have an extra couple hundred bucks in your budget each month. If you really want to ramp up your savings, try putting that monthly payment into a savings account. Since you've been living without that amount for as long as you've been paying the debt, you already know you don't need the money to live on. Put that amount, preferably via automatic transfer, into your savings.

Take advantage of technology

There's an app for everything these days, so of course, there are apps designed to encourage you to save. And many of them are free.

With Unsplurge, you set up a savings goal and it helps tracks your progress. It even gives you the option of joining a community of savers who motivate one another to save.

Daily Budget allows you to create a budget and determine how much you want to save each month. It then breaks your savings goals down to monthly, weekly, and even daily amounts so saving doesn't seem so difficult. Then it notifies you regularly to show you how much you've saved. Being able to actually see your success is a great motivator to keep on saving.

Many banks offer tools designed to help you save through their online banking. Many apps, allow you to create savings goals and get regular notifications via email about your progress.


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