How To Make A Savings Plan
Whether you’re an expert saver, or struggling to make ends meet, there are certainly a few tips that will improve how you save money. Every dollar you save today will be worth much more in the future.
For many of us our issue is the desire for instant gratification rather than future benefits. Most of us naturally would be more inclined to take a week long vacation right now instead of push through for another 10 months and be able to take a 3 week vacation in the future.
We want the reward, not the wait!
Thankfully, there are a few proven tips and tricks that will help you improve your savings plans. Consider this your starting point to a healthy savings account and a wealthy financial future. Here are 5 savings tips that may just make or break your financial future.
5 Expert Savings Tips & Tricks To Build Wealth
The following tips and tricks are proven strategies for anyone looking to increase their savings and build wealth. With just a few small changes, you will eliminate potential errors and accelerate your net worth.
1. Have A Savings Goal & Objective
One issue consumers have is thinking they just need to “save” more money in general. This is a great starting point, however it’s like making a blind decision, not knowing the reason behind your actions.
Setting a goal for your saved money will add motivation to the equation, give more ownership to the task, and result in a more satisfied achievement once the goal is reached.
Common savings goals include retirement, a major purchase such as a home or car, a plan for a family vacation, and anything in between! Name your goal for each dollar saved, and the chances of you achieving that goal are much higher.
2. Anything Is Better Than Nothing
Many families and individuals feel that they don’t have enough money left over to save. The problem is, they put unnecessary expenses and wants first, and their savings last.
The solution is to pay yourself first – even if it’s just a few bucks here and there! Although small at first, the continuous effort will build that savings “muscle,” and with time create a saving habit. Before you know it the money set aside will add up to more than you realized. It’s the money you never realized you had!
3. Automate Your Savings
It’s easy to create a savings plan and say you’re going to stick to it for the long run. Weeks and months pass and you forget you ever made a plan in the first place, and in fact you may now be even further behind than when you first started (in terms of debt rather than saving more…)
A quick and easy fix to this problem is setting up an automatic fund transfer on a regular basis. Once you’ve named your goal and objective for the saved money and budgeted how much you can afford to set aside (even if it’s just $5 here and there), use an automated transfer tool to do the rest of the work for you.
You may decide to do this on a weekly, bi-weekly or monthly basis. My suggestion would be to simply set up an automatic transfer on the day they get paid. It puts the money straight into your savings plan before you even knew you had it – taking away the temptation to spend it instead.
4. Increase Your Income
I know, it’s easier said than done. But, one of the biggest factors in building wealth is your income, and obviously the more you make the more you can save. So, how is one to increase their income?
Thanks to the internet, there are many ways you can make more money in just a few extra hours per week – resulting in a few extra bucks each month! The outcome greatly varies, but I have known people who were able to increase their income by thousands per month with the ideas below.
Give some of these a try and find what works for you:
- Sell old products around the house on Amazon, eBay, or apps such as Offerup and Letgo.
- Create an affiliate marketing website and write product reviews in an industry you enjoy. For example: electronics, shopping, health, wealth, etc.
- Do freelance work online through freelance websites such as Upwork, Fiverr and Freelancer.com. You can post gigs offering anything from digital marketing, SEO services, graphic design services, content creation, and so much more! The opportunities are endless if you have the skills to share.
- Search for local “help wanted” postings on apps like Jyve. Jyve lets you see businesses locally that need blue collar work like stocking shelves, landscaping, and other related jobs for contract.
Regardless of how you start, it’s not uncommon to spend 5-10 hours per week and bring in an extra $1,000 per month. Imagine the progress you can make towards reaching your savings goals with an extra $1,000 per month!
5. Time is your best friend
Last but not least, it’s been said that compound interest is the 8th wonder of the world. What is compound interest? It’s the concept of getting interest returns on previous interest returns received, creating exponential growth of money.
For example, if you save $100, and get a 10% rate of return that year, you now have $110. Next year your rate of return may be 10% again, except this time it’s 10% on $110 rather than $100. Add that up over time and it begins to grow very quickly! So what does time have to do with this? The longer you save and invest your money, the more interest you will be collecting! Free money added to the efforts you have been putting into your savings account. Over the years, you can build a large enough amount of money to live on just a portion of the rate of return you receive each year!
The Potential Is Nearly Unlimited…
Often, saving more money is not only an issue of finances, but also an issue of creating the right habits and being in control of your money. Financial experts like Dave Ramsey, for example, have studied thousands of millionaires all over the US. They found from their research that many of the millionaires today are not wealthy because they make $300k per year, but rather they created good habits early on, and many live on just an average $50k income!
By following these 5 money savings habits, no doubt you will be on the right track to building wealth at an accelerated and exponential rate!