What does Big Foot, Trump’s sense of empathy, and your savings have in common? None of them exists! A night spent in the woods won’t reveal a Sasquatch any more than extensive scrolling on Trump’s Twitter feed will reveal a heartwarming tweet. Likewise, you won’t unearth a hidden treasure chest just by staring at your savings account. But there is one thing that sets your absent savings apart from the others. You won’t find something that isn’t there, but you can build up savings from scratch.
If the thought of starting your emergency fund strikes fear in your heart, stay calm. You’re already taking a step in the right direction by thinking about your money in this way. Your next step is to use this guide to learn simple ways that help create savings.
Think about your goals critically
The foundation of successful savings is a specific goal. When you can give a reason why you’re putting your money away, you’ll feel more inclined to continue saving. Make them personal because that’s the only way you’ll convince yourself to spend less money on fun things.
Personal finance guru Gail Vaz-Oxlade recommends you:
Figure out what’s important to you. So what is it you really want? Is it eating out and spending time with your friends? Or do you want to own a home of your own? Decide, because you may not in fact want to own [a home] — you may simply be bowing to the pressures around you to own.
Take the time to find out what motivates you to save. If it’s a martini at the end of the work week, then let that glass act as a reminder when you have to eliminate other kinds of spending. But if it is a home that you’re after, cut out frivolous spending on expensive cocktails.
Use a budget
A budget fulfils two major functions. One is it reveals the inner workings of your spending habits by tracking the money that goes in and out of your hands. In other words, it helps you figure out how much leftover money you have to spend once you cover your regular and necessary expenses. When you spend beyond your means, you need to make changes to your spending habits to make sure you have enough expendable cash to go towards your goals.
A budget’s second function is its ability to highlight those spending behaviors that make achieving your goals impossible. Once you adjust your budget to eliminate these things, you’ll free up cash that can go towards an emergency fund or an emergency martini fund.
If you’re struggling to find things to cut out, you may need some extra help making your budget. The folks at MoneyKey created a simple resource center for people who don’t have a lot of expendable income. Since they help their customers secure quick online loans, they understand what it means to live paycheck to paycheck. With this kind of financial reality in mind, they created a center with real-world budgeting tips that work even if you’re currently using a cash loan.
When you can find a resource that’s tailored to your financial situation, success is in your future. They aren’t realistic strategies that will only serve to frustrate you, but actionable tips you can put to use.
Save the change
When you break a small bill, make a point of putting the remaining change in a piggy bank. You don’t need a pink porcelain pig to keep your coins. Any container will do as long as you keep yourself from using it to pay for your bus fare or to tip the delivery person. Once your mason jar, decorative vase, or piggybank fills up, roll up the change and head to the bank to deposit it in your savings account.
Don’t worry if you never carry cash in your wallet. An app like Acorns pairs with your debit card to round up purchases to the nearest dollar. It then automatically transfers the difference to a special Acorns savings account.
Now that you have a lot of homework, it’s time you sit down with your finances and think about your goals. An emergency fund isn’t the stuff of fantasy. You can have a real savings account filled with actual money if you put the time and effort into saving. It might not be easy, but it’s worth the effort once you realize you have a financial security net the next time a disaster comes your way.
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