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.
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.
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: vacations, a cozy retirement, education, a growing family or 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, like a high-yield savings account from AmEx, 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.
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.
Win $500 – and Start the New Year Right!
When you sign-up to receive bi-weekly email updates from GOBankingRates, you’ll automatically be entered for a chance to win our $500 #BestBanksBestYou sweepstakes. Sign up now!
For official contest rules, click here.