Hi everyone, personal finance author Stefanie O'Connell from stefanieoconnell.com here,
sharing five simple ways to grow your savings this year.
Saving is probably one of the earliest concepts we learn, starting with our very first piggy
bank or allowance. We all know we should be doing it, we might
even be trying, but when it actually comes to setting our money aside in savings, many
of us still fall short. These five strategies can help you prioritize
your savings, so that you're able to grow your savings balance and afford the milestone
money goals -- like buying a home, traveling or retiring -- that matter most to you.
1. Live Within Your Means It's impossible to save money if you're
spending more than you earn each month. That's why learning to live within your means
is so important. If you want to increase your savings rate
quickly, increase the gap between what you earn and what you spend each month by finding
ways to reduce your recurring expenses. For example, consider cutting cable TV, reducing
your utility usage, renegotiating your cellphone plan and using public transit when possible.
2. Pay Yourself First In other words, don't wait until the end
of the month to set your money aside in savings. Much like you might pay your bills, like your
rent or your mortgage, at the start of each month, think of your savings contribution
like a bill you pay to yourself. By making your savings contribution at the
beginning of the month, you'll be less likely to overspend elsewhere and more likely to
maintain your commitment to your savings growth. 3. Automate Your Savings
Instead of paying the bills each month and saving whatever's left over, automate a
transfer directly from your checking account into your savings account immediately after
your paycheck lands in your account each time. When you don't see your money sitting in your
checking account, you may be less likely to think of it as part of your spending allowance, circumventing
yourself in service of your savings. 4. Save an Additional Percentage of Your Income
With Each Raise While you may not be able to save much when
you're just starting out in your career, you can and should increase your savings
contributions as you progress in your professional career.
For example, if you get a 5 percent raise this year, consider increasing the percentage
of your salary that you're saving by 1 or 2 percent, as well.
5. Consider a 'Side Hustle' for Additional Income
Cutting back on your expenses isn't the only way to increase the gap between your
earnings and your expenses. You can also grow the income side of the equation
by picking up a "side hustle," like freelance design work, babysitting or tutoring, to help make
extra money. By expanding your income, you'll be more
able to increase your savings contributions, too.
For more tips on how to reach your savings goals, visit allstate.com/blog and follow
me @stefanieoconnell.
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