Financial stress is the highest it’s been since 2015, with 65% of those surveyed saying money is a significant source of stress. Even grimmer, among the 18–25 age group, 82% cited money as a significant source of stress in their lives.
Similarly, a recent Bankrate survey found that for those who worry about money, insufficient emergency savings was the top factor, with 57% of respondents citing it as an issue that negatively impacts their mental health
So today, we’re bringing you the top 10 brilliant money-saving tips that you can apply to your life today. While we acknowledge saving money isn’t always as easy as 1-2-3, we hope these tips will help ease some financial strain and give you a good starting point as you consider ways to save for the future.
1. Automate Your Savings
Automating your savings is one of the easiest ways to save money because it’s something you don’t have to think about.
As humans, we tend to seek immediate satisfaction and would often rather splurge now than invest money for the future because we’re biased toward our present selves. Automating your savings can help you overcome present bias by removing that choice entirely.
Of course, you can still access those funds if you need them, but you’ll be less likely to touch those funds if they’re not sitting in your checking account.
If you receive direct deposits from your employer, you can split your paycheck between a checking account and a high-yield savings account that can help you earn interest on your savings.
You can also automate your savings directly through your bank by setting automatic deposits to move from your checking account to your savings account on a set day each month. If you’re curious, here’s a list of what NerdWallet calls the best high-yield savings accounts.
2. Create a Budget
Keeping tabs on how you spend your money is vital for planning for the future and knowing where you can cut spending.
Forbes Advisor recently released a list of convenient budgeting apps for those who may want to track their spending digitally. Plus, there’s always Excel and the good old pen-and-paper method.
Money guru and Netflix star Ramit Sethi recommends a savings method in which you “spend extravagantly on the things you love while cutting costs mercilessly on the things you don’t.” As a general rule of thumb, Sethi recommends the following budget for your take-home money:
- 50%–60%: Fixed costs (rent, mortgage, utilities, etc.)
- 10% (minimum): Long-term retirement investments
- 5%–10%: Short-term savings (down payment on a house, gifts, vacation, etc.)
- 20%–35%: Guilt-free spending (eating out, buying new clothes, etc.)
3. Take Advantage of “Free Money”
If you’re not contributing enough money to your 401(k) to get your full employer match, you’re leaving money on the table.
That’s money MagnifyMoney’s Ismat Mangla says “belongs to you and is part of your compensation.” Yet 17.5 million working Americans are leaving that money on the table, according to a recent survey. Don’t make that mistake if you can afford not to.
As a side note, if you quit your job last year and are not sure what to do with your old 401(k), you might consider rolling a portion of it into a self-directed IRA to diversify your portfolio with alternative assets.
Alternative assets often have a greater opportunity for outsized returns, making them an excellent option for those seeking to grow their wealth in a retirement account. (This could also be a savvy move if expert predictions of a flat market over the next decade prove to be true.)
4. Pay Down Debts
Tackling your debt is crucial if you’re looking for ways to save money. That’s because your debt is accruing interest over time, meaning it’s constantly working against you.
Especially when you consider that the average credit card interest rate in the U.S. is 16.65%, tackling your debt first will be more effective than saving money by brewing your own coffee or really anything from this list.
Once your debt is paid, you can focus more fully on your savings goals.
5. Cancel Unused Subscriptions
A recent survey by the National Research Group found that approximately two-thirds of consumers said they will have to decrease their spending because of inflation. However, respondents were less likely to cut subscription services like Amazon Prime, Netflix, and Hulu than food and gasoline.
While we’d never encourage you to cancel something that brings you joy, it’s important to keep a pulse on your subscriptions and cancel those you don’t use. Because subscriptions are charged automatically, it’s rare that a person “doesn’t have at least one sneaky charge they’ve forgotten about,” according to Kathryn Hauer, a certified financial planner.
Apps like Rocket Money can help you keep track of your subscription charges and even cancel subscriptions directly from their platform. Considering the research also found that the average person underestimates the cost of their subscription services by at least $100 a month, taking a more active role could help you save big.
6. Ignore Your Raise
Have you been busting your tail going above and beyond at work? Considering finally mustering the courage to ask for a raise?
Even if you get a raise, try maintaining your current budget and throw the rest into savings. The temptation may be to inflate your lifestyle to match a pay bump, but maintaining your lifestyle can help you reach your savings goals even quicker.
As an example, someone making $50,000 a year who gets just a 3% raise could save the entire raise, which would amount to $1,500 annually. Better yet, put it in a tax-advantaged retirement account like a traditional or Roth IRA to make the most of your salary increase.
7. Clean Up Your Email Subscriptions
We’re all for email subscriptions. In fact, our crypto newsletter is top-tier, if we do say so ourselves. (Ahem, subscribe by filling out the form here.)
However, once you buy something online, you’re typically opting in to the brand’s email promotions, and that can lead to impulse buying. If you know that a certain type of product or brand piques your desire to impulse buy, you may want to go ahead and hit the “unsubscribe” button.
8. Travel Off-Season
Catch the travel bug? If you want to save a bit on the expense, consider traveling off-season. When traveling off-season, you may be surprised at the amount of fun you can have for much less than if you had traveled during peak season.
The benefits of traveling off-season include more affordable lodging options, flights, and more. (Plus, fewer crowds for our introverted readers.)
Going, formerly known as Scott’s Cheap Flights, is one option that gets recommended often. It’s an email subscription that alerts you when flight prices have dropped for your favorite locations, often offering extremely low rates during the off-season.
You may consider giving it a try next time you come down with the travel bug. And yes, we just advised against enticing email subscriptions that may lead to impulse buying, but cheap travel is an entirely different ballgame, right?
9. Utilize Free Library Resources
Local libraries are a treasure trove of often-underutilized services and resources. Many offer skill-building resources like LinkedIn Learning and language courses.
Additionally, libraries often offer a resource called the Libby app, which allows you to rent popular magazines and audiobooks through your local library for free. You can even rent ebooks for free and send them directly to your Kindle.
This can help you cut spending while still focusing on personal development and continuous growth.
10. Shop Sustainably
You’ve probably heard it before: Buy quality, not quantity. While it’s often tempting to buy the latest trends (thanks Gen Z for outlawing skinny jeans), shopping sustainably by thrifting or buying classic, high-quality pieces that will last you for many years is a great way to save money over the long run.
Plus, by limiting your fast fashion purchases, you’re caring for the planet.
Diversify Your Portfolio with a Self-Directed IRA
We hope these top 10 brilliant money-saving tips have been helpful and give you some new ideas for upping your savings game. And while you’re at it, you may consider using some of those savings to diversify your portfolio.
Find out how you can invest in art, startups, crypto, and more with a self-directed IRA from Alto.
Originally published October 10, 2022
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