Get a sense of your current financial situation. You can do this by retrieving a few months’ worth of bank statements from your financial institution’s website and going over your expenses.
Begin where you are.
This will assist you in determining how much you can save. For example, if you typically spend the majority or all of your income before the next payday, it’s probably not a good idea to set aside a substantial sum — such as $1,000 — each month.
Instead, look for ways to deposit a lesser sum, say $50, into your savings account on a monthly basis. When you stick to the plan, you give yourself a string of victories to build on. You may also be able to generate further savings by reducing your spending. You don’t have to give up your favorite avocado snack or your drive-through coffee. However, if you order takeaway lunch five days a week, you may want to reduce it to three days and bring inexpensive meals from home on the other two. Looking for a new place to invest your money? See NerdWallet’s list of the top savings accounts for options with high interest rates and low fees.
If your budget is tight and there aren’t many places to save, you might be able to raise your income. This could include starting a side business, selling unwanted stuff, or seeking for a better-paying work. It’s not always simple to come up with quick cash, but these ideas may help you acquire some wriggle room in your budget.
Automate your savings.
When it comes to savings, your bank’s mobile app and website are your best friends because you can utilize them to automate transactions. (According to a Mintel research, over 54% of online bank clients feel their institutions’ mobile apps make dealing with banks easier. )
You can set up automatic transfers so that, for example, a certain amount of money is transferred from your checking account to your savings account on each paycheck. With little extra effort, you’ll be able to watch your savings amount grow over time.