Think you can’t build your savings if you live paycheck to paycheck? I’m here to say you can do it – you just need to know how.
I remember the days when I struggled to make ends meet. Payday was not really a happy day for me as 90% of my paycheck was always gone the minute the check was put into my hand. I had little left to actually live off of every two weeks. It felt as if I were constantly robbing Peter to pay Paul.
I remained in this same cycle for years. And sure, I wanted to be able to save money, but I could not see how that was possible. How in the world can someone expect me to save even a penny when I am struggling to make ends meet?
If only I knew then what I know now.
Saving money is possible, no matter your income. You just have to learn how to do it – and you have to want to do it.
- Quickly Boost Your Emergency Fund
- Automate Your Savings Account
- How to Save $12,000 in a Year
- Cut Your Grocery Bill in Half
How much do you need to save?
The ultimate savings account should cover at least 3 – 6 months worth of expenses. When you are starting out, that number may seem completely out of reach. That is why it is good to set your first goal to save $1,000.
By having at least $1,000 saved, you have a resource to cover unexpected expenses, such as car repairs. Your savings prevents you from having to rack up more debt and can help you more quickly reach your financial goals.
The easy trick to build your savings
The way to easily build your savings account is to automate it. This is simple enough for anyone to do. Just create an automatic transfer from your bank to your savings account on each payday. The amount can be as small as even $5 to get you started.
When your check hits your account, that money is deducted from one account and moved into another. You never even really see it. That gives you less in your account and you just make that work with your budget. By moving money into a savings account automatically, you never touch it.
An added bonus of automating it is that you will not be tempted not to save. You would have to go through steps to get that money back into your checking account. Most won’t do that.
Another option is to change the bank you use. Chime rounds up every transaction to the nearest dollar and automatically moves it to your savings account. Those small amounts can add up very quickly, helping you reach your savings goals. And, as an added bonus, they are giving Penny Pinchin’ Mom readers a FREE $5 bonus when they sign up and make their first deposit!!
When you don’t see it, you won’t miss it.
Find ways to save more
Once you have set up your plan to automate your savings, the key is to see if you can find other ways to save more money. Some things to consider:
Sell items. Look around your house to find things you no longer need or use. Sell them by hosting a garage sell or post them on a local sales page (such as Craigslist).
Cut back. Small budget changes can make a big difference in reaching your savings goal. For instance, if you have dinner out only once a week, rather than twice, you may be able to save $125 or more each and every month.
Increase your income. Asking for (or getting) a raise at work may not be an option. Instead, find other ways to add to your household income. You might turn your hobby into a business or even take on a second job.
Use your coupons. While they may not be as popular as before, coupons are still the easiest way to save money. This does not just mean grocery coupons. Find coupons to save on your meals or even clothes. The less you spend on the things you need, the more money you have to add to your savings account.
Set your first goal to save $1,000. Once you start saving, you will feel better knowing you have funds available for the unexpected.