Financial planners have different opinions about what you should do with your money, but there are essential money saving tips they all agree on. So, what do financial planners say are the best money saving tips you should never ignore?
21 Money Saving Tips Never to Ignore
1.Have some savings
One tip all financial planners agree on is that you should have a savings plan. They advise that you save a certain amount every month, at least five or ten percent of your salary. It’s best to have the money automatically deposited into your savings account from your paycheck. Experts recommend you save at least one month’s funds to cover an emergency.
2. Don’t spend everything you make
This advice seems simple enough, but if you are living paycheck to paycheck, it is challenging to do. If you have a small salary with debt, you must consider this as you make financial decisions. This time may not be right to purchase a car or eat out every evening. Making wise choices on big or small purchases helps you live within your means.
3. Ask for a raise
If you need an increase to make ends meet at home, ask for it. You need to know what your job is worth in the marketplace. Think about your education, training, job experience, and what you’ve done for your company-all these things contribute to your overall job worth.
Get paid what you’re worth, being underpaid is money you need for bills, savings, and investments. You’ll never be able to get ahead if you are underpaid. If your current job can’t pay you what you’re worth, it may be time to find another job.
4. Pay down credit cards
If you have several credit cards, pay down the credit cards with the highest amount of interest first. Pay off the smallest amount required on your other credits cards to avoid a penalty. After paying off the high-interest credit card, close that one out using only the low-interest cards.
5. Have a budget
Another money savings tip recommended by all financial planners is to have a budget. It gives you a good understanding of where you’re spending your money. Figure out what your total income is after taxes. Choose what kind of budget plan you want to use to keep track of your expenses. You can use banking apps that automatically break down your spending or a spreadsheet to keep track of costs. Pick the plan that works best for you. Then decide what your costs are. The National Institutes of Health offers a list of money-saving tips for food budgeting.
Besides food, your budget includes
- Other groceries
- Household expenses
- Child care
- Pet care
- Work wardrobe
- Banking fees
- Loan payments/credit card payments
- Gym memberships
6. Prepare for retirement
Saving for retirement doesn’t seem important when you are just getting started, but it’s one money savings tips all financial planners suggest. They say you should contribute something to your retirement savings, even if it’s a slight amount. Your employer may offer you a 401(K) retirement plan, and it’s a good idea to add to it. Some plans match what you add with interest. Saving for retirement is essential, and if you begin early, you’ll be nicely situated when you’re older.
Remember, too. Your overall expenses will go down once you hit retirement age. By the time you reach 65 or 70, your house mortgage will be paid off. Plus, your children will be out of the house, so you’ll be spending less on supporting their needs.
7. Pay down other debts
Most financial planners suggest you pay down your student loans and mortgage
slowly. Many mortgages have a penalty if you pay off the loan early. Also, this kind of debt isn’t as high in interest as other kinds of debt. And the interest on student loans and mortgages are tax-deductible. Use for money for other things, like investments or savings.
8. Keep your savings and check account separate
Your checking account has available money you need for your regular monthly expenses and bills. It’s the place where your paycheck will be automatically sent, minus monies you’re putting into your savings account. A checking account gives you access to your money right when you need it. A savings account should be left alone. Depending upon your bank, they will offer an interest rate on your savings.
9. Get rid of your subscriptions
Dump your subscriptions. They eat away at your income. It’s easy to forget if you have them. You often get one or two months free, and then the fees kick in. You may forget you have it.
10. Buy life insurance
If you’re young, you may not think you need life insurance. But if you have dependents or people who depend upon your financial contributions, then you need life insurance.
These people will become financially responsible after you die, so it’s a necessary part of your fiscal money-saving plan. This life insurance will be used to pay off debts after you die. Even if you’re young, buy life insurance since it’s cheaper when you’re young and healthy.
11. Review your budget every year
Every year, review your income, budget, savings, and debt. Life changes, you get a new job, or you have a baby, you realize these changes mean you need to adjust your budget or taxes since you now have a little tax exemption. Other things that affect your financial assessment include;
- Rent changes
- Health insurance premiums rise
- The cost of living goes up-food, clothing, etc.
- Auto-insurance goes up
- Property taxes rise
- Water or electric costs rise
Doing an annual review is like a health checkup. You keep a pulse on how you’re doing financially and can adjust things if needed at this point rather than in a moment of panicked realization of some unexpected costs.
12. Write down all your expenses
This concept is simple enough, but many people don’t do it. Keeping a record of how you spend your money may be revealing. You may be shocked to find you’re spending lots of money on subscriptions or memberships you don’t even use.
13. Check your credit score
Your credit score is the number that shows lenders your borrowing practices. Knowing your credit score will help
- Keep your loan interest rates lower when you borrow money
- Helps you know your overall financial health
- Make sure your score hasn’t been compromised
- Determines if you can spend money on a house or car
- You may not be able to rent an apartment if you have a bad credit score
Having a good credit score is like taking care of your body. Keep it healthy, and you’ll be able to do more things with fewer problems.
14. Use bank apps
Downloading your bank apps on our phone is excellent for keeping tabs on your spending habits. You’re more apt to check your phone since you carry it around. Plus, you’ll get notifications when your account gets hit, so it’s more secure, too.
15. Start saving for holiday costs in January
How many days till the holidays? The best time to save for the next holiday season is as soon as the season is over. Holiday gifts, parties, and travel all add up. When you save early, you won’t be hit with huge expenditures around the holidays.
Financial planners suggest you put aside $50 every month starting in January for your holiday fund. By the time you get to the holidays, you’ll be ready to pay for everything without going into debt.
16. Invest if possible
Most financial planners suggest you invest, even if it’s just a little bit of money. You could invest in
- the stock market
- real estate
- Your employer’s retirement plan
- mutual funds
17. Learn to say no
It’s easy to spend money because of others. If your extended family wants you to join in on a beach house rental for a week, it’s tough to tell them you can’t afford it. It’s hard to admit to your co-workers you can’t go out for drinks with them on Fridays. It takes strength to just say no, but it’s the best choice when you’re trying to get yourself financially stable.
18. Cut out things you don’t need
It’s easy to spend on unnecessary things. Whether it’s purchasing a large coffee every morning at a coffee shop or buying snacks at the snack machine every day, these things add up. Go over your daily, weekly, and monthly expenses. Stop spending money on these little habits. It’s a simple way to save money.
19. Save extra money
If you get a big tax refund, stow it away in your savings account as soon as possible. Things like a bonus at work, an inheritance are perfect for your savings. They weren’t part of your budget, so it’s money you didn’t expect to save.
20. Wait a day before buy
Financial planners would agree that giving yourself a good twenty-four hours before you make a purchase. This waiting period helps offset impulsive purchases. If you’re shopping online, see if you can put your items on a wish list, then go back a few days and see if you want to buy them.
21. Make a cash-only rule
Some financial planners suggest this money saving tip of spending only cash for a brief period. They recommend this so you can get control of your overspending. It’s an abrupt way to get your spending under control, but it might be worth a try.
These money saving tips will help you get your finances in order. With careful planning, you can lead a satisfying and secure financial life.