Managing the month-to-month expenses and bills, all while trying to build up a savings account can be tough! Just when you think you’re on top of it all and can put more away for a rainy day, the floods come and the car needs repairing, your kid takes a trip to the ER, and the heater goes out.
That saying, “when it rains it pours,” never seems more accurate than when unexpected expenses arise. Am I right?
Building up a emergency fund can feel like it’s taking an eternity. Especially if you’re living paycheck-to-paycheck or paying off debt.
But, there are a few easy ways you can start today!
Here are 3 simple steps you can take to start saving money…
1. Understand your money
Look at your bank account and understand where your money is going. Set a budget if you don’t have one, and make sure you are keeping track of your transactions.
Often times you’ll be surprised how much you are spending on Starbucks runs (we found a way to get free Starbucks that’ll help) or extra purchases here and there throughout the month.
2. Open a separate bank account for your emergency fund
You probably already have a checking and a savings account. And that’s great. But open up a third one (maybe an alternate savings account), and you can save even more. Here’s how…
Take your earnings in your checking account and only keep in there what you need to cover basic expenses like rent, groceries and bills. Divide the rest into a savings account emergency fund that is just for emergencies and the remainder into an account for other fun things like shopping, a vacation, movies, etc.
NerdWallet lists 6 financial institutions where you can open multiple savings accounts with some of the highest annual percentage yields (APYs) on the market. These include:
· Alliant High-Rate Savings
· Ally Online Savings Account
· Barclays Online Savings Account
· Capital One 360 Savings
· Discover Online Savings
· Synchrony High Yield Savings Account
3. Cancel memberships or subscriptions you don’t need
Today there are so many things we subscribe to. Everything from meal delivery services, to music and entertainment, gym memberships, etc.
So check your bank statements. Free services Trim can do this for you. Make sure there is not something that automatically renewed that you didn’t know about or that you don’t need anymore.
It’s a new year and a great time to start making goals to save more in 2018. Start with these simple steps and by the end of the year you’ll be surprised how much money you’ve got in savings.