Although the economy seems to be recovering, many people around the world lost their jobs or have experienced financial difficulties in facing the recent recession. This puts into perspective how important it is to start saving money to have a backup in bad times. Especially when financial emergencies arise.
If you are trying to pay off debts, besides having to meet the monthly expenses, itmay seem difficult to start ahorar money. Here are some valuable tips you can follow to ensure that you will be able to add to your savings each month when tough economic times arise. This will also help you avoid having to take out loans for emergencies , which always bring high interest rates .
How to save money: 7 tips to start today
1- Understand your budget
The first step towards building your savings is to understand your budget. Try to keep a diary of your expenses for a month. Each time you make a purchase, write it down. Not only will you become more aware of your expenses, you'll know exactly where your money goes. Understanding your budget means you will be able to predict the amount of money you need every month and how much you can save.
2- Identify where you can cut
Once you have examined your monthly budget, you can find some areas where you can pay less. How much of your income is essential to as rent, utilities, gas and groceries? How much goes to the unessential? If you are trying to know how to start saving your money and a high percentage of your income goes toward nonessentials, like cable, eating out, or unnecessary expenses, consider reducing in those habits.
3- Setting goals
After examining your spending habits, count the amount of your income you can set aside to save every month. It helps to have a serious goal in mind. For example you can set two major goals; save for emergencies and set personal savings goals.
a) Save for emergencies
Before you start saving for specific purposes, make sure you have enough saved to stay afloat for at least three months in case of financial emergencies such as job loss, sudden illness or repairing your Motorcade. The more you can add to emergency funds safer (a) you will feel. Save enough to cover six months of living expenses is an ideal way to establish an emergency fund.
b) Personal Goals
Is there a major purchase that continues putting off? A new car? A new TV or computer? A down payment on a house? Know how much you need to save for specific goals can help you keep your momentum savings. Keep track of the money you've been saving and how much you need to save to reach your goal.
4- Open a savings account
Open a savings account with a credit union, local bank, or bank online is a great way to make sure that the money you save this insurance. Be sure to look for a bank that allows you to open a savings account with a low monthly fee or better even that will not be charged and that offer a decent interest rate. That way, your money will grow by itself and not have to pay to keep your money in a safe place. It is also a good idea to choose a bank that offers online banking or mobile so you can manage your money remotely from your home, office or anywhere where you are.
5- Autosave
If you are having trouble convincing himself (a) to save each month, consider creating automatic deposits. Set weekly or monthly transfers of the same amount from your checking account to your savings account. It's a good idea to schedule this for the day after receiving your paycheck to make sure (a) that is sufficient to cover the needs.
6- Keep long term
Long-term savings may be the key to achieving the dreams of a lifetime or a comfortable retirement. Small amounts of money aside on a regular basis, it adds up over time. If your employer offers a retirement plan (save for retirement) 401 (k), take advantage of it. This is one of the best ways to build long-term savings.Choosing not to participate is quite like making the free money. Many employers will match all or part of the contributions to the 401 (k) plans for their employees.There are also tax benefits but note that there may be tax penalties for participants who withdraw funds prematurely (before age 59-1 / 2) from your 401 (k).
7- The sooner the better
The most important part is to start saving. Even if you are able to contribute only a small amount every week or even every month, save any amount, however small it is better than nothing. While saving money is not a quick process, building your savings provides a sense of security; The more you save, you will be able to recover a financial emergency front-law.
Learn how to save guided by these tips and start now!