Saving money can be a frustrating endeavor, especially when it feels like the bills are piling up faster than you can pay them. But saving money isn’t just a good idea; it’s absolutely essential. For instance, if the transmission on your car suddenly stops working, are you going to have the money to replace it? Life is unpredictable, and a good nest egg can help you to weather the inevitable storms.
Besides savings for emergencies, though, there are actually numerous benefits to saving money, including:
-A cozy retirement
-An improved standard of living
But it’s easy to understand why you should put money away. The tricky part is actually understanding how to save money, and then zeroing in on the best ways to save money.
When you decide to become financially responsible and start putting money away, your first course of action should be to open a good savings account. Compare the best interest rates of different savings accounts, and bear in mind that some of the best savings accounts are online savings accounts due to low overhead costs of online banks. Keep in mind that some savings accounts require a minimum deposit.
Make it a point to put money in your savings account every time you receive a check. Only you can determine how much of your paycheck you can afford to save, but the key is consistency. Even if you can only place 10 percent in savings, do it every time. Those small savings will add up.
If you want to put money aside for a rainy day, it’s important to understand that your saving habits are directly tied to your spending habits. By trimming unnecessary expenses, you can save money without even trying. Here are some basic money saving tips:
-Opt for a free checking account. Many banks still offer these.
-Don’t be ashamed to clip coupons.
-Send credit card payments at least a week before their due dates.
-Shop for deals online: Hotels, restaurants and even airlines often offer deep discounts, but you have to compare.
-Cook your own food more often, using fresh ingredients.
-Refinance your mortgage, but only if you can secure a rate lower than your current rate.
Saving money is all about using common sense, and sometimes the best ways to save money involve small, incremental changes. Even things like switching to generic toothpaste brands and cutting back on 4-dollar lattes can leave you with a much larger balance in the bank at the end of the month. But if you really want to know how to save money, the answer can be summed up in one word: Discipline.
It’s okay to splurge once in a while, but in general, remember the value of your hard-earned cash and constantly be on the lookout for ways in which you can get the best values. Just because you have a few extra dollars in the bank does not mean that you have to run to Las Vegas for a weekend of reckless spending. Saving is freedom.