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3/8/2018

Nine Simple Ways to Start Saving Money Today

Increase your savings without sacrificing your way of life.

There's a common misconception that to save money you must make serious sacrifices. By following the right tips and tricks, you can cut down on excess spending and steadily increase your savings. Consider the following strategies for holding onto more of your earnings without giving up the lifestyle you enjoy:

  • Carry larger bills. Imagine you're carrying a $20 bill, two $10 bills, one $5 bill and five ones. You might spend some of that money on a coffee, go out to lunch or splurge on a new shirt. Now think about if you were carrying one $50 bill. You probably wouldn't be as likely to break that bill to grab a coffee or some other minor expense, an example of what is called the "denomination effect."1 Play into your psyche by trading in smaller bills for larger ones and you may easily save some money.
  • Take your time. Impulse buying is a major challenge to savings goals. Whenever you're tempted to splurge on a big purchase, hit pause before pulling out your wallet. Mark the item in your calendar and then wait a specified period of time before you decide to actually buy the item. Take that time to read reviews, research alternative options and think about whether you really still want it. The initial appeal may fade over time; if it doesn't, go ahead and buy it.
  • Consolidate your cards. Carrying credit card debt from month to month? If you have a large number of credit cards, it's easy to continue putting off payments on one card by another. Consider limiting the use of some of your cards as you pay down credit debt so that you're left with only a few. This will help keep you more organized and provide fewer opportunities to accrue debt moving forward.
  • Choose an internet bank. Choosing a savingsmoney market or CD account with an online bank is a convenient way to build up savings from anywhere at any time. With the low cost structure of internet banks, you'll also likely be able to avoid costly fees and high minimum deposit requirements.
  • Check out as a guest when online shopping. Online shopping offers lots of spending temptations, and storing your credit card information on a website for a quicker checkout is chief among them. Sure, retyping your credit card information every time you want to make a purchase online is a little inconvenient, but it may keep you from making a purchase you don't really need. Curb impulse spending by adding an extra step to your online shopping experience.
  • Regularly review your credit report. Keep an eye on your credit report for any inaccuracies or outdated information that could impact upcoming loan applications. Ensuring your report is up to date might also help you secure a better interest rate. Plan to request and review your credit report annually, or even more frequently in anticipation of applying for a significant loan, such as a mortgage.
  • Read personal finance resources. With the vast amount of financial expertise available through the internet today, there is no excuse for not regularly spending time increasing your financial knowledge. Read articles from publications like Kiplinger's Personal Finance, MONEY, and Consumer Reports for practical advice and ideas that can help you manage money more effectively while avoiding amateur mistakes. Follow thought leaders in the financial industry and look to your bank for even more targeted tips.
  • Cut down on energy usage. Not only is cutting down on your energy use good for the environment, it's good for your bank account, too. All kinds of devices, including speakers, laptops, chargers, toasters, and more use energy whenever they are plugged in. Make sure to unplug them when they're not in use to keep your utility bills low. To make this more convenient, connect several devices to a power strip so you can disconnect them all at once.
  • Shop off-season items. Plan out your major purchases so that you're taking advantage of seasonal discounts. For example, furniture and bedding is typically cheaper after the holidays and warm-weather items like air conditioners and patio furniture are often deeply discounted at the end of the summer. If you know you'll need certain items in the coming year, look at your calendar to schedule when you'll want to make those purchases so that you're getting the best deals.

Following these tips doesn't guarantee you'll become wealthy, but it should help you make the most of the money you earn by providing you with additional opportunities for saving. So what are you waiting for? Get started today.

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