Some people talk about saving money like it’s as hard as running a marathon. However, this is far from the truth. With the right attitude, healthy habits and a good grasp on where your money is going, you can save money with the best of them.
Today, we’re going over some simple budgeting tips to get you back on the right track when it comes to saving money.
Letting debts linger over time will seriously impact your overall financial stability. If you’re constantly in the hole on credit cards, personal loans, and car payments, you’re never going to have any financial freedom. This is where targeting debts becomes important.
Figure out which of your debts has the highest interest rate, and focus what income you can on that debt. Once you’ve paid for your bills and set aside the money for food and gas, look at what you can do with the remainder.
If you had planned to save that money, consider funneling it, instead, into your highest-interest debt. Shooting that debt to zero as quickly and efficiently as you can is a critical aspect of getting yourself on top of your finances.
Once you’ve done that, repeat this process with your next-highest debt, and so on. You’ll be seeing more money from your paycheck and faster debt payoff than you’d expect without this strategy.
This isn’t as grim as it sounds. Budgeting to zero means you give each and every dollar of your income a job before you even get it. Some of those dollars are going to be paying for your bills, others are going towards groceries and gas. Some can be given the job of “spending money,” but don’t overdo it with this one.
The rest can be given the job of being saved or invested. If you’re looking to grow your savings, an investment account can be a wise move, putting the money into a reliable, slow-growing stock portfolio that can see some consistent returns.
Just because you can buy something doesn’t mean you should. That shiny new car might say it only needs low monthly payments, but that’s debt you’ll be putting yourself into for years. When making purchases, consider your entire income, not just what you can spare. Remember: the sooner you get to saving, the more money you’ll have in the long run.
So, instead of getting that new car, why not put that money back into a safe investment, like your retirement account? Your future self will thank you for such savvy moves.