5 Things You Should Be Doing Right Now to Save More Money

Let’s face it. We all wish we could save more money. Money is a topic we all get pretty passionate about, and I’m no exception.

Over the years I’ve tried many different things to save more money. I’ve cut cable, brought out a calculator in the grocery store, and cut back on eating out and fun money. Every penny matter’s and those things certainly helped. Though I’ve found that some things can save big dollars while not really affecting your budget at all.

I put together my top 5 things that were complete game changers in helping me save the most money over the last several years:

Take advantage of employer retirement matches

Not everyone has this opportunity, but if you do, you definitely should be taking advantage of it. If your employer matches even 20% of what you put in (meaning, you put in $100, they would put in $20) that is an automatic 20% return on your money. If you employer matches 100% up to a certain amount, that is a 100% return on your money. If you have ANY leftover money after paying the absolute minimum necessities for your family, that money should be going towards taking advantage of the maximum you can of an employer’s retirement match. If they only match the first 5% (meaning if you put in 6%, they contribute some amount on the first 5%), then put in that 5% if you can afford it, whether you contribute more than that or not.

Track and understand your spending

This one is key. Here’s a challenge. Write down every single penny that enters or leaves your life in the next month. Every. Single. Penny. It’s incredibly eye-opening. You might realize that you have a clothing addiction, or that you spend three times as much as you thought on food. It will tell you if you are living above your means (spending more than you are bringing in), and see the biggest culprit that is taking your hard-earned money. Take a look at where your money is going, and try to find at least 3 areas where those expenses aren’t really serving you and your goals. Then focus on decreasing or eliminating them completely.

Set up automatic savings through direct deposit

Most employers have the ability to split your paycheck into multiple bank accounts. If yours has this option, use it. More specifically, figure out how much you need for your spending for a given paycheck (see tracking your spending mentioned above), and set that amount to go into your everyday account that you use. Then put the rest into a savings account. The benefit of doing it this way (and not the other way around, where a set amount goes into your savings and the rest into a checking) is that any raises or bonuses you get automatically goes straight into your savings. By using direct deposit, you never see that money enter your checking account. This tricks your brain into thinking you make less than you really do, meaning you are more likely to think you cannot afford something, and are less likely to spend money.

Keep your savings in a separate bank

I have most of my savings in Ally Bank. They offer the best interest rate that I’ve found without investing (as of this writing). But it is not the bank I use regularly. It takes me 3 business days to transfer money from savings to my checking account. I have to give it thought if I really want to spend that money, and I have to plan ahead to make sure I allow enough time for the transfer. Those things, however small they may seem, make a big difference. By having the automatic savings mentioned above, only purchases I’ve already budgeted for comes from my checking. Having to take the time and effort to make the transfer forces me to stop and contemplate whether that purchase is really worth it after all.

Have a goal.

My biggest secret to saving a lot of money is to have a goal. More specifically, a goal that I believe is just barely out of reach. It has to be a stretch goal, not something I think I can actually hit, but it can’t be so far out there that it seems helpless. If it’s too attainable, I’ll start thinking about it too late. But if not attainable enough, then I won’t even try in the first place. There’s has to be a healthy balance if I want to save as much as I possibly can! The most important thing I can do is to keep my brain and thoughts on my finances, which is easiest when I have a clear, concise, specific goal I want to hit. It doesn’t have to be far out, and it doesn’t have to be complicated. How do you create such a goal?

1. Define what you want: Do you want to save? Pay off debt? Increase your net worth? Finance a house remodel? If you’re not really sure, think of your non-financial goals. Take time to figure out what it is you really want from your financial future. Here’s some examples:
   • If you’ve always wanted to foster animals, maybe your financial goal should be to save enough money to invest in supplies or a housing remodel to make space for the animals.
   • If you can’t stand your job and want to quit, a financial goal could be a larger emergency fund, or to work towards financial independence.
   • If you have an expensive hobby, maybe the goal is just to be able to afford to indulge in your hobby more often without going into debt.
2. Give it a number: Is it a set number? Or maybe a percentage? Make it specific and know where your starting point is.
3. Set a date: It could be monthly, quarterly, yearly, or anything in between. I recommend not setting a goal more than one year out. If you do have a goal of more than a year, try to break it down into at least two parts, and figure out what the first thing you need to do in order to accomplish that goal. Then give that first part a timeline (of less than one year). Whatever the numbers look like for you, if you say it and you feel sad or depressed, you’re trying to do too much. If it feels like a piece of cake and you say no worries, you’re selling yourself short. You need to read your goal to yourself and feel motivated and optimistic. That’s when you’ve hit your sweet spot.
4. A couple examples of well-defined goals are:
   • Save $1000 in 2 months.
   • Save an emergency fund of 3 months of expenses ($10,000) in 1 year.
   • Pay off my credit card with a current balance of $5000 by July 1
   • Increase my net worth by 30% this year (or by the end of this year).
   • Quit my job in 3 years. This could be broken down into building up a side hustle and making an extra $1000/month the first year, decreasing my expenses by 20% the second year, and building up an adequate emergency savings the third year.

Increasing your saving is actually very simple if you implement these 5 financial tips: take advantage of your employer’s retirement match, understand where your money is going, automate your savings, in a separate bank than your everyday account, and coming up with at least one short term financial goal. In addition, these tips can be implemented almost immediately with minimal time commitments. When you start to pay attention to your money on a simple high level, you will also start to pay attention to it at a more detailed level, which translates into more money – and less stress – for you.