Learn how to save up money

Saving money is not always as easy as it sounds. Sometimes the most difficult step is just getting started. This easy step-by-step plan will help you save money by providing you with realistic tips that are simple to follow long-term.

1. Record All Expenses 

Start off by making a list of everything you spend in a day, big and small. This includes every coffee you purchase, the gas you put in your car, and household bills. You can also use credit card statements to double check your spending habits. Do this religiously for a month to find out exactly where your money is going.

2. Come Up With a Budget 

Now that you know just where your money goes every month, you can easily come up with a workable budget. Remember to factor in expenses that do not occur every month, such as car maintenance or house taxes. Compare your expenses to your income and see where you can cut corners. This way, you can stop overspending and start saving.

3. Make a Plan to Save 

Add a savings category into your new budget. If you can, put aside up to 15% of your income per month. If you are unable to save that much, this might indicate that you need to cut back. Find the non-essentials that you can cut out, such as dining out or clothes shopping, and then adjust your spending accordingly so that you can save more.

4. Have a Goal 

An easy way to save is to save towards a specific goal, such as a vacation or retirement. Figure out just how much money you will need to achieve your goal and how long it will take to get there. Consider putting this money into another account, such as an IRA.

5. Choose Your Priorities 

It is important that your long-term goal, such as a retirement plan, does not get put on the back burner in favor of short-term goals. For example, if you know that you will soon be spending money on your child’s college education, start putting away as much as you can now.

6. Use the Right Tools 

If you are saving your money for a short-term goal, consider a savings account or a certificate of deposit. For long-term goals, you will want to put your money into IRAs, stocks, or mutual funds. Consider all of your options carefully before you choose. Check out details such as fees and interest rates in order to pick the one that will work the best for your goal.

7. Save Automatically 

Many banks now offer the option of transferring a set amount of money directly into your savings account from your checking account. You don’t even have to think about it-the bank just does it for you. This is a simple way to effortlessly save money every time a deposit is made.

8. Watch as Your Savings Grow 

Keep track of your budget every month to check out the progress you are making. This allows you to stick with your plan while identifying any problems. As you watch your savings grow larger every month it may even inspire you to save more.