Back to our money tips :) Today's topic building up a savings account...it's not as hard as you may think.
It's scary to know that most people have little to no money put away in a savings account. I know with the bad economy it's not easy to put money into a savings account...or at least that's what you tell yourself. Most people don't save money because they make a million excuses why they can't save money, but I promise you can!
I do not have a ton of money in savings, but I do have enough to cover an unexpected expense or give me a little padding if something was to happen. Do you? If not I am going to give you a few tips of ways to start saving small and eventually build up to a nice rainy day fund.
I got serious about saving money the year I paid my car off. When I made my last payment I knew I was fixing to have extra money every month and I didn't want to end up blowing all that money each month on stupid stuff so I started putting it away. I didn't trust myself to put it in my savings account myself so I switched my direct deposit at work to automatically put the money into my savings account instead of my checking account. You don't have to start with a large amount of money, just $20.00 a week will turn into a savings of $1,040.00 at the end of the year....amazing!
If you have direct deposit at work go to your human resource rep and tell them you need to add an account onto your direct deposit. Then add your savings account and start with $20.00 per week from your paycheck. I promise you wont miss that 20 bucks, you are wasting it somewhere in your life right now. After awhile you won't even notice that you have lost that 20 and you can increase it to more at a later date.
Another way I put money in savings is something I like to call "dumping". You have your monthly budget and it's the end of the month and you have managed to do well with your finances for the month and have money left in your checking account. When this happens to me I "dump" the excess money into my savings account. If you leave that extra money in your checking account you are more likely to go spend it!!! So at the end of each month when everything is paid "dump" that money and start the new month fresh. You will be amazed how much money this could add to your savings in a years time. Sometimes I may have an extra 150.00 and some months only 15.00 no matter how big or small I "dump" it!
Spare change... I have places I put spare change. I have a basket in the laundry room because we all know you find spare change in the washing machine all the time :) Then I have a jar in the bedroom where most of the spare change I round up goes. Leave the spare change alone! Once or twice a year sort it all out and deposit it into your savings account. You won't using it anyway so why not put it in savings? Look at spare change as a hidden bonus. We all have it, but rarely think of it.
Hiding money in your checking account. For years I rounded my paychecks down a few dollars and didn't write down to the cent when I balanced my checking account. You will be surprised how much extra money builds up over time. Personally I like to keep a little hidden padding in my checking account in case I forget to write something down, but a few months ago my padding was up to an extra $900.00. So I dumped a good chuck of that into my savings. Rounding down can build extra money that can jump into your savings account over time or at least give you padding if you ever forget to write something down. It works for me :)
Another tip...if you are the type of person who saves a little money but constantly dips into the money you save I have a simple solution! Having your savings and checking accounts at the same bank can make it very easy to rob your savings account. HELLO this defeats the whole purpose of saving! To stop this, put your savings account at a different bank and don't let them give you a debit card to access it. I can say I had this problem back in the day. I have 1 savings account at the bank where I have my checking account and 1 savings account at another bank. Reason being I had the problem of just taking that money out of my savings account and the other bank pays better interest on their savings accounts. It's a lot easier to save money if you cant access it very easily...just saying.
Hope these simple steps can help you get on the track to saving. Don't just say your going to start saving money....MAKE IT HAPPEN! A rainy day fund never hurt anyone :)
Now that I gave you my tips I am going to tell you how I do my personal savings. I get paid every two weeks. My take home pay gets distributed the following way.
Savings Account #1 = $50.00 (bi weekly payroll)
Savings Account #2 = A Good Chunk (bi weekly payroll)
Checking Account = What's left over
Now I know you are thinking the $250.00 is a crazy amount, but like I said I started doing this when I paid my car off, and never stopped. This money that I saved came in handy for a lot of more expensive items I wanted. For example... I paid cash when I bought my new 4 wheeler and I paid cash when we bought our new bedroom suite and mattress. That savings account has bought me some high dollar purchases without any hassle or stressing over where the money was going to come from!
Savings Account #1 I use to save the money to pay my home owners insurance and taxes on my house each year (not escrowed in on my place) That is two big bills that hit me in December and instead of stressing over trying to get the money together I save for all year long. You can do this for yearly expenses you have too. I find it is a lot easier to put the money away and have it there when I need it!
Savings account #2 I pretty much leave alone. It is at a separate bank and I don't have easy access to it. When I decided to buy big items this is where the money comes from. I always have a decent amount here just in case something happens. It came in real handy this year when I got that $1,200.00 repair bill on my Honda.
I don't think of my self as an excessive saver. I just try to save as much as possible. Who can complain with having money put up? I promise there will always come a time when you need it.
It's scary to know that most people have little to no money put away in a savings account. I know with the bad economy it's not easy to put money into a savings account...or at least that's what you tell yourself. Most people don't save money because they make a million excuses why they can't save money, but I promise you can!
I do not have a ton of money in savings, but I do have enough to cover an unexpected expense or give me a little padding if something was to happen. Do you? If not I am going to give you a few tips of ways to start saving small and eventually build up to a nice rainy day fund.
I got serious about saving money the year I paid my car off. When I made my last payment I knew I was fixing to have extra money every month and I didn't want to end up blowing all that money each month on stupid stuff so I started putting it away. I didn't trust myself to put it in my savings account myself so I switched my direct deposit at work to automatically put the money into my savings account instead of my checking account. You don't have to start with a large amount of money, just $20.00 a week will turn into a savings of $1,040.00 at the end of the year....amazing!
If you have direct deposit at work go to your human resource rep and tell them you need to add an account onto your direct deposit. Then add your savings account and start with $20.00 per week from your paycheck. I promise you wont miss that 20 bucks, you are wasting it somewhere in your life right now. After awhile you won't even notice that you have lost that 20 and you can increase it to more at a later date.
Another way I put money in savings is something I like to call "dumping". You have your monthly budget and it's the end of the month and you have managed to do well with your finances for the month and have money left in your checking account. When this happens to me I "dump" the excess money into my savings account. If you leave that extra money in your checking account you are more likely to go spend it!!! So at the end of each month when everything is paid "dump" that money and start the new month fresh. You will be amazed how much money this could add to your savings in a years time. Sometimes I may have an extra 150.00 and some months only 15.00 no matter how big or small I "dump" it!
Spare change... I have places I put spare change. I have a basket in the laundry room because we all know you find spare change in the washing machine all the time :) Then I have a jar in the bedroom where most of the spare change I round up goes. Leave the spare change alone! Once or twice a year sort it all out and deposit it into your savings account. You won't using it anyway so why not put it in savings? Look at spare change as a hidden bonus. We all have it, but rarely think of it.
Hiding money in your checking account. For years I rounded my paychecks down a few dollars and didn't write down to the cent when I balanced my checking account. You will be surprised how much extra money builds up over time. Personally I like to keep a little hidden padding in my checking account in case I forget to write something down, but a few months ago my padding was up to an extra $900.00. So I dumped a good chuck of that into my savings. Rounding down can build extra money that can jump into your savings account over time or at least give you padding if you ever forget to write something down. It works for me :)
Another tip...if you are the type of person who saves a little money but constantly dips into the money you save I have a simple solution! Having your savings and checking accounts at the same bank can make it very easy to rob your savings account. HELLO this defeats the whole purpose of saving! To stop this, put your savings account at a different bank and don't let them give you a debit card to access it. I can say I had this problem back in the day. I have 1 savings account at the bank where I have my checking account and 1 savings account at another bank. Reason being I had the problem of just taking that money out of my savings account and the other bank pays better interest on their savings accounts. It's a lot easier to save money if you cant access it very easily...just saying.
Hope these simple steps can help you get on the track to saving. Don't just say your going to start saving money....MAKE IT HAPPEN! A rainy day fund never hurt anyone :)
Now that I gave you my tips I am going to tell you how I do my personal savings. I get paid every two weeks. My take home pay gets distributed the following way.
Savings Account #1 = $50.00 (bi weekly payroll)
Savings Account #2 = A Good Chunk (bi weekly payroll)
Checking Account = What's left over
Now I know you are thinking the $250.00 is a crazy amount, but like I said I started doing this when I paid my car off, and never stopped. This money that I saved came in handy for a lot of more expensive items I wanted. For example... I paid cash when I bought my new 4 wheeler and I paid cash when we bought our new bedroom suite and mattress. That savings account has bought me some high dollar purchases without any hassle or stressing over where the money was going to come from!
Savings Account #1 I use to save the money to pay my home owners insurance and taxes on my house each year (not escrowed in on my place) That is two big bills that hit me in December and instead of stressing over trying to get the money together I save for all year long. You can do this for yearly expenses you have too. I find it is a lot easier to put the money away and have it there when I need it!
Savings account #2 I pretty much leave alone. It is at a separate bank and I don't have easy access to it. When I decided to buy big items this is where the money comes from. I always have a decent amount here just in case something happens. It came in real handy this year when I got that $1,200.00 repair bill on my Honda.
I don't think of my self as an excessive saver. I just try to save as much as possible. Who can complain with having money put up? I promise there will always come a time when you need it.
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