What is the best way to save money.?

Question

I'm trying to save money so i will always have a safety net. My problem is i end up spending it. what is the best why to save money and prevent myself from spending it.

Answer 1

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Create a savings account (or a second savings if you already have one) and start direct deposit where a certain amount of your check goes into the special savings account each time like 10 or 20 percent or an even $25 or $100 per paycheck. Then restrict yourself to only using the checking account and act like the savings account doesn't exist. Worked for me.

Answer 2

You're smart to want to save -- especially these days. This talk about the economy bouncing back is baloney -- it's all because the sinking dollar, government stimulus money, and companies laying off employees. Hard times are NOT over yet.

You don't say where your money comes from, but if you're employed, many companies have a plan which deducts a specific amount of money from each paycheck so you never get your hands on it. The plan may be through a credit union or a tax-deferred retirement plan. Ask about these in your HR dept.

If you're not employed, or your company doesn't have such a plan, all I can say is "Pay yourself first." That is save money before you pay anyone else -- and live within your means.

Answer 3

You know, to be honest, there are some people for which strict budgets are never actually going to work.

If you're a bit daunted by it, there is a much easier way to save money.

Do a rough budget so you at least know how much you spend on essentials every week. You should be able to do this by remembering roughly how much you spend on certain items, and put aside a little for utilities too. It's important to know occasionally where your money goes. But this is not going to be a hard and fast 'budget' for you to stick to. It's just an excercise so you can see at a glance what your finances are actually like.

Then, go to another bank (one that is difficult to get to, or has annoying and inconvenient opening hours) and get them to set you up a passbook account with NO internet banking and NO debit card. Get an account that has high interest, and no fees. If that's impossible, seek out an account that only charges fees for withdrawals, not a monthly 'service' fee. That will keep your costs down.

Then, go to your employer. Ask them to have part of your income (ten percent is a good start) paid by direct debit into that account. That way, you're saving the money before it goes to your normal bank account. It's called 'paying yourself first'.

Because the account is at an inconvenient bank, you have to really plan whether you want to access the money. That will make you think twice about spending it. Because you can't go and find out the balance without going into the bank, it'll be a nice surprise when you do. After a few weeks, you'll be used to living on your reduced wage (believe me, it happens) and your spending will change accordingly. The 'savings' will just accumulate in the other account. When you get a large amount, you can set up a mutual or managed fund investment (ask if your bank has a financial planner you can see for free, because sometimes they offer this as a free service) and then have contributions deducted monthly from your savings account.

This is the easiest way to save money. I've been doing it for years. I told a friend of mine to do this two years ago, when she was $1200 in debt, and she told me this week that if it wasn't for this advice, she wouldn't have been able to buy her house. It really is a powerful and simple way to completely change your life, and it's unbelievably easy to do. It'll probably take you a few minutes to set up the account, and a few minutes at work talking to whoever is working in Payroll, but after that, you're laughing.

If your employer doesn't split your wage over two accounts, simply set up a direct debit at your bank on pay day. That way, it should be taken out of your account in the morning, before you can access your money.

Cheers

Answer 4

You need to automate your finances. I had the same problem when I was trying to save. I learn how to make my finances run on autopilot so that I made sure to not spend money when I should be saving it and spent less time managing it every month.

You may also want to get creative on how to spend less and maybe earn more.

There is a website that offers a free service to teach you all of this stuff. 5gplan.com.

Good luck!

Source(s):

http://financialsecrets101.com