Written by Erica Quin-Easter, Midcoast Regional Manager and Workforce Specialist
We all have financial goals and dreams. Sometimes, we struggle to put our goals into action while living paycheck to paycheck. Regardless of our income levels, our spending tends to rise and fall in proportion to the money we have available.
It can be frustrating to feel like you’re stuck with no savings even when your financial situation improves on paper. It can also leave you feeling vulnerable when unforeseen circumstances arise.
So, how can you start squirreling away money even when your monthly budget feels tight? Here are five saving strategies to help you move forward:
Divide & Conquer:
Make separate savings accounts for your different financial goals. Each savings category can have its own sub-account so you can track your progress toward your goal. This will make it so you will be less likely to transfer money out of those accounts for other purposes.
Consider having different accounts for your:
- Emergency fund
- Seasonal expenses
- Medical deductible
- Home purchase or repairs
Automate Your Savings:
Move money on a routine basis from your regular account into your savings accounts. Set your goals on a weekly, biweekly, or monthly basis. Then, automate your savings and forget about it while your money grows!
Take advantage of tools like:
- Payroll deductions
- Bill pay functions at your bank or credit union
- Automatic withdrawals
Do you have a hard time keeping your hands off your savings? Consider opening accounts at separate financial institutions (banks, credit unions, online savings accounts). This will make it harder to transfer money out of your savings and into your checking account.
Do you have multiple income streams? Try directing one or more of your income sources straight into savings. Set aside income from reimbursements, odd jobs, occasional gifts, and other income sources to help your savings grow. This also prevents you from relying on income that isn’t consistent or is out of your control.
Add It Up:
If you receive a raise or a bump in your income, direct the additional income straight into savings. Saving the difference will help you avoid “lifestyle creep.” Lifestyle Creep is the phenomenon experienced when expenses mysteriously increase as income grows.
If you are interested in learning more about budgeting, building your savings, and repairing your credit, check out our tuition-free workshops and trainings!