What Savings Looks Like When You're a Beginner. If a budget is something you are terrified of, don't let it frighten you away from making great choices for your family this year. Below, I am showing you exactly what saving money looks like when you're a beginner. It's not all about sacrificing everything you enjoy, but about understanding money and how it works in your daily life.
What Saving Money Looks Like
Benjamin Franklin once said, “If you would be wealthy, think of saving as well as getting.” We as Americans have been brainwashed to spend more than what we make, allowing our debt to be in control of us, instead of the other way around. When are we going to break free from this way of thinking? If you’re ready to get on the right track, consider these methods for saving money, which will create a brighter future for you and your family.
Pay Off Debt First
Saving money while you have debt will be next to impossible when you’re dealing with payments and interest on top of that. Before you can even begin saving money properly, pay off the debt that you may have accumulated. It’s a whole lot easier to save money when you just have your basic bills each month to worry about.
Here are 10 creative ways to save money!
Use Credit Cards Wisely
While it might be in your best interest to avoid credit cards altogether, at least choose to use credit cards in a wise manner. Credit cards do have perks when you get a new one where you can basically get free money. As long as you pay those credit cards off immediately, the interest rates won’t steal your savings.
Instead of using a credit card to go out to eat or order in takeout, use my tips for how to eat well on a budget and make amazing meals at home.
Create a Budget
When you’re beginning to look at saving money, you need to set a budget on your spending. Sit down and determine exactly how much you need to have in order to pay your bills. You also need to stick to that budget. That might mean not eating out or heading to the movies as often as you once did.
If you don't know where to start, begin with my tips for creating a household budget. This is an ideal method to get started on getting out of debt. tips for creating a household budget
Track and Control Your Spending
In order to have a better understanding of where your money is going, keep track and control the way you spend it. If you notice that you stop in at the 7-11 to get a Slurpee often, maybe you should be staying away from that convenience store for a while.
I use things like this list of Dollar Tree Cleaning Supplies You Should Buy to help stay on track. There are many items the generic version works just as well if not better. Don't always go for the name brand, and think before you swipe that card for snacks or treats.
This is also a time when you need to make sure you are tracking properly. Overdrafts can get out of hand fast. If that happens, check out my tips for what to do if you have an overdraft in your bank account to navigate and stay on track.
Build an Emergency Fund
It’s also wise to get an emergency fund set up of at least $1,000. Dave Ramsey mentions this in his book Financial Peace. This will prepare you for almost any emergency while keeping you from returning to the credit card to bail you out.
This 52 Week Savings Plan for Debt Resolution is my favorite way to save without it feeling like a burden. It's vital to a healthy budget and financial future.
You also need to negotiate payments to help you save even more money long term. While you can’t change your house and car payment, you can negotiate your cable, phone, and insurance bill. Companies don’t want to lose good customers. As long as you’ve made consistent payments, those companies will usually settle at a lower cost for you.
Most experts would tell you that you should be setting aside around 20% of your paycheck every week by putting it into your savings account. This will also help encourage you not to spend extra money.
Automate Your Savings
Don’t stop there. How about making the savings process even easier. You can have a chunk of your paycheck automatically put into savings each week without you having to push a button or head to the bank. Saving doesn't get any easier.
These are several ways for you to save money when you’re a beginner. If you’ve paid off debt and been saving for a while, tell us about any tips that you might have from your success story.