The best place to start saving money is with small, everyday habits. After a while, these habits will become automatic. And, best of all, you’ll be able to save your way into getting whatever you want.
1. Change your mindset“Saving money and gaining control of your finances is a mind game before anything else. You can tell people how to save more money but they won’t actually do it without changing their mindset first,” author and finance blogger Amanda Abella told OppLoans.
For most of us, changing our mindset first is essential because what we’ve learned about money is from an outside force.
Personally, I attributed my spending and saving ways to my mom. She saved money all year so that we could alway have a nice vacation every year growing up, and so that we could have a nice Christmas every year—I mean, really nice.
She also made sure that in our large family we had new clothing for school. Five days worth of outfits so that we could rotate those pieces and not have to wear the same thing in a week. If I planned it right, I could mix and match many weeks.
- Money doesn’t grow on trees.
- It’s impossible to make money in this economy.
- I can’t afford this.
- Money is the root of all evil.
- It’s not possible to profit off your passion.
- Affluent individuals are greedy.
- What have you been telling yourself about your financial situation?
- Where did these stories come from and how have they affected your finances?
- What are some of your hidden fears about money?
- How has your money story evolved over time?
Afterward, you should be able to identify the “stories you may have picked up about money—whether from your parents, your partners, your broke friends, or society as a whole.” But, that doesn’t mean that this has to be your tale.
In fact, “you can rewrite your money story any time you want,” she says. Remember, it’s never too late.
2. Record your expensesWriting down or recording your expenses is probably not how you want to spend your leisure time. But, keeping a record is essential if you want to reach both your short-tern and long-term savings goals.
In a nutshell, you want to keep track of all your expenses. Everything from that cup of coffee you get on the way to work to utility bills should be included. The reason is simple, having the amounts and what you spent your hard earned cash on is concrete proof on how much money you’re spending so that you can trim the fat.
3. Learn how to set SMART goalsWhen it comes to savings, you have to be intentional. For example, it would be fantastic if everyone was a millionaire. But, just declaring that you want to have a stacked bank account isn’t going to make that goal a reality.
4. Wave goodbye to debtDebt isn’t always a terrible thing. I mean mortgage not only puts a roof over your head, but it could also potentially be an investment if you build equity. In this case, you might view this as “good” debt.
What you really need to focus on are your bad debts. You know what I’m talking about. Those vampires that suck the life out of your financial independence and savings.
But, getting rid of “silly debt” or debts where you’ve just been extravagant or a spendthrift can be a challenge—especially if living paycheck-to-paycheck. The good news? It’s not impossible.
Basically, you work until you maybe have your mortgage payment and maybe a car payment—no credit card debt. It IS possible.
5. Automate as much as you canDid you know that you can set it and forget it when it comes to saving money? It’s true. One popular example would automatically transfer a percentage of your paycheck into a savings account each month.
6. Try an anti-budgetWhen it comes to savings habits, one-size doesn’t fit all. As Paula Pant perfectly puts it in an article for The Balance, “not everyone is a natural saver, and not everyone loves budgets or spreadsheets.” If you “get bored or tired of meticulously tracking your expenditures,” you might want to try out alternatives, such as the anti-budget.
For the anti-budget, “You simply pull your savings from the top and spend the rest,” explains Pant. “There are no budget categories to keep track of.”
7. Make the most of substitutionsWhen it comes to certain items, it’s usually better to go with quality over quantity. For example, a pair of Ray-Bans may set you back around $150. But, if you take care of them you’re going to get mileage out of these shades then a pair of $5 glasses. In fact, over time, you spend more on those cheap sunglasses because you’re constantly replacing them.
8. Master the art of negotiatingObviously, you can’t be negotiating all the time. You aren’t going to be able to walk into your local grocery store and haggle the price of apple juice or other items you are purchasing. However, there should be wiggle room on some of your other expenses.
9. Use coupons and discounts as much as possibleHere’s a secret for you; even wealthy individuals use coupons. In fact, everyone from Warren Buffett, Bill Gates, Lady Gaga, and Carmelo Anthony are known couponers. So, follow their lead and be cost-conscious by only making purchases when you have a coupon.
10. Establish spending barriersDespite your best efforts, it can be difficult to control your impulse to spend. The good news? You can prevent this from happening by establishing barriers, such as:
- Only shopping in-person with cash.
- Deleting saved payment information you have stored online.
- Using free store pick-up or delivery so that you stick to your shopping list.
- Unsubscribing from emails so that you’re not tempted to spend.
- Adopting the 30-day rule where you don’t purchase an item for a month. If you still want it, then go ahead and buy it.
11. Watch your savings growAt the end of each month, set aside the time to review your progress. It’s a simple way for you to make sure that you’re sticking to your savings plan. And, since you can see that you moving the needle, you’ll be motivated to keep up the excellent work.
Also, this will let you know of any potential problems. In turn, you can fix them before they get any worse.