Tuesday, April 19, 2022

How to Save Money and Plan for Your Financial Future

Living from paycheck to paycheck is a leading cause of stress among much of the population. There are surveys that indicate nearly 50% of Americans would have trouble coming up with the money to pay for a $400 emergency.

This is not a good recipe for financial success. That's why saving money is so important.

Make Saving Automatic


David Bach popularized the concept of the latte factor, which suggests cutting out mindless spending to build wealth over time. While that is perhaps his most famous recommendation, he also encourages people to make their savings automatic. 

Signing up for automatic withdrawals to a savings or investment account is a great way to make sure the money actually gets saved. 

People who wait to save what's leftover at the end of the month generally have no money left over to put toward their long-term goals. Therefore, paying yourself first is a necessary step to start building some savings.


Consider a Credit Union


When most people think of where they might put their savings, a large commercial bank might come to mind. However, credit unions are also a great option. 

Some companies, like Credit Union of Denver, know that these financial institutions run just like a bank. They offer loans at competitive rates, and they also have accounts that allow for savings and investments. 

Sometimes, these accounts come with better interest rates for savers. Members run credit unions, rather than shareholders who may or may not use a commercial bank's services.

Track and Trim Expenses


Many Americans spend mindlessly. Sure, there are bills that you'll have to pay monthly that stay relatively stable. These include things like rent, car payments, and food. 

There are other expenses that are completely unnecessary. Going out to a movie theater every weekend and eating out for lunch every day can get expensive. 

Tracking these expenses and trimming them back a little could put $100 or more back into your budget every single month. Over time, what might not seem like a huge sum of money could grow into a significant nest egg.

Make More Money


There are several options for making more money. The easiest might be simply asking for a raise. It can also pay to do a bit of job-hopping. 

Sometimes, switching employers can lead to some pretty hefty pay increases. Another option is starting a new side hustle that can bring in a few bucks. 

Over time, a side hustle might turn into your primary income, which means that it doesn't hurt to start one.

Putting some money away for emergencies or for the future is key to your financial health. That's why it's important to make savings automatic. 

Taking these tips into consideration can be a great way to increase your financial freedom over time. The earlier you start, the more likely you are to succeed in stashing some cash for your long-term goals.


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