When money is tight, it can feel like the world is closing in on you.
Getting from paycheck to paycheck can feel impossible, let alone any sort of money savings. Not everyone has the financial stability to put money away for the future, but there are always things you can do to better your situation.
If you’re going to get out of the money hole that you’re in, you’ll have to get a little bit crafty. In this post, we’re going to tell you about a few simple ways to improve your money savings. At King Cash, we never like to see our customers struggling, so keep reading and learn how to save money for the future.
1. Track Your Spending
If you’re going to be able to start saving money, then you need to know what you’ve been spending your money on. Tracking your spending can feel like a huge hassle until you start doing it, then you’ll realize that the little bit of extra work will make a huge impact on the way you think about spending.
There are apps available that help you track your spending, but all you need is to log it into a spreadsheet. This will let you know where most of your money is going – rent, groceries, shopping, etc. – and give you an idea of where to cut back.
When you don’t keep track of where your money is going, it’s easy to feel like it’s disappearing on you. Spending awareness is the first step in improving your money savings.
2. Create a Budget
There’s no way to understate how important budgeting is for your ability to save money. Tracking your spending for a few months will help you a lot when it comes to budgeting and creating a system that works for you.
A budget is made up of two types of expenses: fixed and variable. Fixed expenses are the things you need to pay for every month in order to live. They include rent, car insurance, and utilities, among other things and they’ll make up most of your monthly budget.
Variable expenses are the things that change every month, like groceries, eating at restaurants, and shopping. These are the things that you’ll have to start compromising in order to stay under budget.
Use your expenses to create a budget that you can comfortably stick to every month or year. You should also factor credit card payments and savings into the budget so that you’re being more careful with your money.
3. Get Your Credit Paid Off and Other Goals
As you’re creating your monthly budget, think hard about what your money goals ultimately are. Are you trying to get all of your debts paid off so you can start saving for something? Or are you saving up for a big purchase, like a home or car?
Getting rid of your credit card debt, as well as any other debts you may have, should always be the number one priority. Every time you pay off your credit card in full, you’re going to see a little boost to your credit score. It also helps you from paying an exorbitant amount in interest.
In some scenarios, it can be beneficial to get a small loan to pay off a credit card. At KingCash.ca, we offer Canadians a fast and easy alternative to loans from financial institutions.
4. Build Up Your Savings
By sticking to your monthly budget, you should be able to start building up your savings account. Having money in your savings is crucial not only for saving money for buying a home or car, but you never know when a financial emergency might come up.
Contributing to your savings account doesn’t have to debilitate you financially in the short-term. Even $50 per month will start to build up over time, and as you get more comfortable within your budget, you can increase it as you see fit.
5. Cut Out Unnecessary Expenses
When you’re more thoughtful about your spending habits, you can start to figure out what you’ve been spending too much money on. We’ve all got frivolous things that we like to spend on, but if money’s tight, you have to be smart about cutting certain things out.
One effective way of doing this is by analyzing every purchase you make. First, is the item something you need or something you want? If it’s something you need and you can afford it, then buy it.
If it’s something you want, however, the process needs to be more critical. Ask yourself if it’s something you can live without or if it will have a lasting purpose in your life. Doing this can help you from impulse buying, which is how many people get into money trouble in the first place.
6. Start Investing
Investing is a great way to build wealth for the future. Even small contributions to a low risk investment account can get you on the path to money savings. One of the first places you should start is with your 401(k).
Check if your employer offers 401(k) matching. This means that they’ll match your monthly contribution, effectively doubling your retirement savings. The sooner you can start putting money in your retirement fund, the better.
You don’t have to stop there, however. You can start making low-risk investments in high-interest savings accounts, money market funds, or dividends. These will all pay out small, but significant amounts without much risk of you losing any money.
Taking Money Savings Seriously
These are a few crucial tips that will help your money savings. When you’re used to living without money, it’s difficult to change your mindset about spending and savings. By following these tips, you’ll put your current and future self in a much better financial situation.
Getting your finances in order takes time. At Kingcash.ca, we understand the financial troubles that Canadians experience on a daily basis, which is why we offer no-nonsense loans. Visit our site today to learn more about how our loans work and read our blog for more helpful financial tips.