Money management skills are hard to come by these days. With the majority of the population testing as financially illiterate, it is no wonder that so many of us are suffering overwhelming debt burdens. Add in economic pressures and an unfriendly job market, and we have a recipe for financial disaster. Although it sounds simple there is really only one way to minimize the impact of economic or personal factors on one’s financial stability: save more money.
Save More, Spend Less
Most of us are aware that saving money is important to our overall financial health. However, few of us actually prioritize spending or even plan for our financial future in terms of saving. Ignoring the savings account and floating along month to month barely maintaining our finances is no way to live. There are a few tricks to becoming a savvy saver that can help minimize the risk of overloaded debts and the need for debt relief in the future.
1. Create and follow a monthly budget, including a category for savings.
2. Set a minimum amount you commit to saving each month, 5-10% is a healthy goal.
3. Sign up for automatic checking to savings draft to make saving easy and effortless.
4. Eliminate one item of unnecessary spending, or one “fun” purchase, per month and put that money into your savings instead.
5. Develop short and long term goals for your savings account, such as $1000 in one year and $10,000 in five years.