Finances FYI Presented by JPMorgan Chase
Everyone wants to save money, but it can be a lot easier said than done. Many of us have tried budgeting in the past with little success and are left without a safety net.
Having about six months’ worth of expenses socked away in case of emergency is essential in case you lose your job or have a large, unexpected expense. Luckily, with just a few minor tweaks to your habits, you can save money for just about anything.
Set a Goal
First, determine how much you want to save. Aside from a rainy day fund, think about what kinds of things you might want to save up for. Maybe it’s a large purchase like a vacation or a new car. Or maybe you want to save up a downpayment for a house. Either way, figure out the number and write it down, along with the timeframe for when you want to be ready to make the purchase. Be realistic about your goals, but try to push yourself a little bit as well.
Address Your Debt
It’s hard to save money, but it’s even harder when you’re paying off credit cards or loans every month. Use the debt snowball method to pay down your debt so that more of your money can go toward saving than paying off old debts.
Assess Your Spending
Find out where your money is going every month. Many banks today allow you to download a spreadsheet that shows where you spent and how much. Alternatively, keep track by writing down your spending at the end of every day, or keep receipts and tally it all up on the weekend. Knowing where your money goes will help you figure out where you can cut back.
Make the Cut
It might not be fun, but look at your spending habits and see where you can trim. If you spend a lot of money dining out or on movies or clothes, consider cutting back on those things while you work to reach your goals. It will be worth it when you finally take that trip or make that purchase.
Pack Your Lunch
It can be hard to resist the temptation of a nearby sandwich shop or pizza joint at lunchtime every day, but you can save hundreds of dollars a month by brown-bagging it to work. By bringing an easy sandwich and piece of fruit rather than buying the same meal, you can save as much as $10 per day, which adds up.
Make it Automatic
Many banks or paycheck processors today allow you to split your direct deposit paycheck into multiple accounts. Take advantage of this by directing a certain amount of money right into a savings account at every paycheck. If you’ve set your budget correctly, you won’t even notice it’s gone, and before long, you’ll have a great little nest egg with zero effort.
By conscientiously saving energy around your home, you can cut your electric bill and save big bucks. Wear a sweater in the winter rather than cranking up the heat or invest in energy-efficient lightbulbs, which are more expensive upfront but save money in the long run by lasting longer and using less electricity.
Plan out your meals for the week before you go grocery shopping and make a list accordingly. Stick to the list and don’t impulse buy. For extra savings, look up the weekly ads for local grocery stores online and plan your menu, and list around what’s on sale. Pay attention to price tags and weigh things like produce to get only what you need. This is better for your wallet and the environment, too.
Subscriptions are all the rage these days, from television to food to clothing. Take a look at your subscriptions and see which ones you really use. Think about which ones you can part with. Would you rather have a house in five years or access to a new TV show today? Reflect on your goals and make choices that will help get you there.
If you have big payments you’re already making, like a car payment or student loan, see if you can get the payments reduced or deferred. Many programs exist, especially for student loans, that allow certain people to make payments that align with their income, making this debt more manageable.
Saving may seem like a daunting prospect, but it doesn’t have to be. With a few easy steps, you can start saving right away and put away money for emergencies while socking away enough cash to get yourself something nice. You deserve it for being so conscientious!
Finances FYI is presented by JPMorgan Chase. JPMorgan Chase is making a $30 billion commitment over the next five years to address some of the largest drivers of the racial wealth divide.