Paying bills, buying a car, getting a mortgage – these are all important, significant expenses, and would not be possible without saving some money.
Saving money can be tricky, even for the most financially responsible among us. All it takes is one sale at your favorite store or a night out on the town to spend some money. However, saving money can be easier than it seems, and once you start saving, you’ll have money left over for all those fun activities.
Here are three smart money-saving tips you can start today:
1. Calculate your expenses
To begin saving money you first need to know how much money you owe for your bills and how much you can save. Start by figuring out your major expenses:
Then, calculate how much you’ll need for “spending money” each month. Once you know this total, you can subtract from your income to see how much you have left.
“Set aside money each month for your expenses, including savings.”
2. Treat savings like an expense
Treat your savings account like one of the major expenses listed above. Set aside money each month for these costs, including savings, so you don’t forget to save too little, or get tempted to spend. If you end up having so many expenses that you can’t dedicate a reasonable sum to savings, it is time to decide if you’re spending too much. Dining in instead of at a restaurant, switching phone plans to a cheaper carrier and other small tweaks can make a big difference over time. Most importantly, check in on your progress! It can be satisfying and motivating to watch your savings increase over time.
3. Leverage your financial institution
The bank is your friend when you’re trying to save money. Start with a savings account to store most of your earnings. You can also set up direct deposit into this account – instead of your checking – to further reduce the temptation to spend. Other financial offerings, like IRAs, stocks and bonds, can also help you turn your income into more money down the road. Trusted financial professionals can also offer guidance.
Finding the right mortgage and buying a home is a rewarding process, but it’s unlikely without strong savings. That is why you should begin saving money today! It’s not as hard as you think, especially if you’re willing to evaluate your expenses and dedicate small chunks of your income to savings on a regular basis. If you have any questions about the homebuying process or are interested in a mortgage, contact First Centennial Mortgage.