There are two main ways to improve your financial situation: make more money or save more money. The importance of various types of savings for both short and long-term use requires conscious decisions about how to save the money you have or increase that amount. These six tips can boost your balances with very little impact overall on your lifestyle.
1 – Make More Money
The most obvious way to get more funds into your savings accounts is to bring in more money from your job or side hustles. If appropriate, ask your boss for a raise depending on the time you worked for the company and how helpful you are. You may also request over time if you are not a salaried worker.
The Internet and wireless connectivity create a wealth of opportunities to earn more money on the side. Consider doing tasks online for a bit more cash, getting involved with a rideshare or delivery service like Uber, or beginning a freelance side business doing anything from coding apps to selling crafts.
2 – Switch Bank Accounts
Whether you have more money coming in or not, make sure it is working for you by choosing the savings accounts with the highest interest rate. Look online for more options. In general, Internet-based accounts give higher rates of interest with lower or no minimum balance requirements. Compared to brick and mortar banks, they also charge much lower fees.
Although an extra 1% may not look like much if you only have a few hundred pounds, everything adds up over time. You save more by looking at your money as a tool to increase wealth. Every time you make extra income or save a certain amount of money, put it directly into a high-interest savings account.
3 – Get Rid of Debt to Save on Interest Payments
The more money you have going toward paying off loans or credit cards every month, the less you have to save. Pay off debt intelligently by focusing on balances with the highest interest rate first. This will save you money in the long run. As soon as you pay off one balance, snowball that amount into the next one. Also, make sure not to take on more debt in the future. The only counter to this tip is if you can get a no or low-interest card or loan to transfer your debt to. This will minimize payments over time and help you save more.
4 – Research and Tweak Regular Bills
Get as much information about your options as possible when it comes to utilities, communication, entertainment, and Internet bills. Besides doing things like lowering your thermostat to save on heating costs, make sure you have the right program and payment options to save you as much as possible. Things like mobile phone plans always have less expensive options somewhere. Only pay for what you need. This tip to save more money also includes things like refinancing auto loans and credit card interest rates. If you have a good payment history, companies are more willing to work with you.
5 – Adopt a Frugal Lifestyle
It may seem obvious to state that spending less everywhere helps you save money. Instead of simply forgoing a take-out coffee drink in favor of at-home brew and similar changes, change your entire attitude toward spending money to save the most. Take the time to research sales, shop supermarkets for store-brand or generic products, and use less of everything than you did before.
In general, practicing frugality means buying things that cost less, using less of everything, repurposing items, and getting rid of waste. It is easy to see that cooking and expensive cut of beef in your oven and then throwing out a quarter of it because you are full and too lazy to properly store the rest is much worse than enjoying a less expensive cut with no waste at all.
6 – Enjoy Different Types of Entertainment
Going out to theater costs more than streaming Netflix at home. A night out at the pub with mixed drinks for everyone costs more than relaxing at home with some buddies and beer. Even things like favorite hobbies or sports can be enjoyed with lower spending amounts. Saving money every month is not about giving up everything you enjoy. Instead, it is about discovering new ways to live your life without waste.
The matter whether you focus on making more money, spending less on everything you buy, or both, these ways of saving more money every month only work if you put the focus on proper money management. Earning extra by selling products or services online will mean nothing but a waste of time if you turn around and spend that new income on a more expensive phone or a fancy dinner out with a date. Likewise, clipping coupons or buying generic groceries has no impact if you spend that money on day trips to neighboring cities. While these things may shift your quality of life, they do not help you save.
What is so important about saving more money anyway? Of course, if you live paycheck to paycheck, an emergency savings account can mean the difference between comfort and financial ruin. For example, if your car breaks down and you have no savings, you will have to go into debt to fix it or walk everywhere. Even people who save some now can improve the quality of their future life by saving more.
Saving money is about having control over your finances and your future. Making conscious decisions to earn additional money, not spend as much of it, and to intelligently handle debt and credit means you will have more opportunity to use your savings for things you really need or value highly. With these six money-saving tips, you can have a happier and more comfortable future.