Conserving Cash: A Guide To Keeping More In Your Pocket

Saving money isn’t easy; it takes effort just to come up with a plan and then implement it. Figuring out ways to save in the first place is difficult. Then, it becomes even harder to take those savings and use them to reach your goals. The following guide will help you start a savings plan and see it through to the end.

1. Write Down What You Spend

In order to save, you have to know what your current level of spending is. Write down every single thing you buy, from gas to groceries. After you have a list of your expenses, put each item in a category. For example, all expenditures for the house should go into one group. Your credit card statements can actually help with this process; they make it clear how much you are spending and what you are spending it on.

2. Set A Budget

After you know what your expenses look like, you can create a budget. A budget takes into account your income and helps you manage your expenses so you can save money. Be sure to think about any expenses that you may not have incurred the month before. For example, you likely need to get an oil change every few months. Factor in irregular expenses, too.

3. Get Ready To Save

Once you have your budget in place, put in a line for “savings.” If possible, start by saving ten percent of your income. As you find success, gradually increase that number to fifteen percent. If you have a lot of expenses, those numbers may not be possible. Do what you can and look for opportunities to cut back so you can reduce your expenses. There are likely items that you are spending money on that are not essential. For example, you may like to stop and get a cup of coffee each morning, but it is not something that you have to do. You should also look to cut needed expenditure such as lowering home electricity costs or car insurance via Moneyexpert.com. It is possible to save a nice sum of money each month, but you have to work at it!

Savings should be right up there with paying your mortgage each month. It isn’t something you can skimp on. The longer you do it, the easier it will become.

4. Have A Savings Goal

What is it that you want or need? It is a lot easier to save if you have a goal in mind, particularly if that goal is something very motivating to you. Determine how long it will take you to reach your goal. There are online calculators that can help you determine this.

Goals fall into different categories. Short term goals are things you can achieve in three years or less. These might include a down payment on a car, a vacation or an emergency fund.

Long term goals usually take four or more years to reach. A college fund for your child is one example of a long term goal. A remodeling project is another.

5. Figure Out What You Want Most

Your goals have a big impact on this entire process. Remember, while short term goals are great too, they should not get in the way of your long term goals. Figure out what is most important to you, save for that, and then go from there. Sometimes, it’s clear from the outset what you need to be saving for. Other times, it may be more up to your discretion.

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