7 Money-Saving Tips That Actually Work

Let's be honest: Saving money isn't much fun. But If we spent it all without care, we'd never reach long-term goals like buying a home or retiring. Like it or not, unless you win the lottery or inherit millions, you have to make saving a part of your life. Try a few of these tips to make it easier.

1. Automate your savings

Saving can be difficult because you often think about what it prevents you from having right now, so you might be tempted to spend instead. Automating savings can help by ending all of that internal debate. You decide how much you'd like to save each week, pay period, or month — and then your bank will automatically transfer those funds to your savings account according to the schedule you set up. You don't have to think about it or remember to transfer any money on your own. All the saving happens in the background, and you can spend the rest of your money (after bills) guilt-free.

2. Use a high-yield savings account

Boosting your savings can be as simple as changing the account where you keep the money. The average savings account has an annual percentage yield (APY) of only 0.07%. High-yield savings accounts have APYs of 2% or more. For an idea of the difference that makes over time, consider $1,000 left in the account for five years. With a 0.07% APY, you wouldn't even be at $1,004 after five years. But with a 2% APY, that $1,000 would be worth $1,104. That's $100 extra just from switching up your savings account, and the difference could be even greater if you have more savings or keep the money in the account longer.

3. Wait before buying things you don't need

If saving was a superhero, impulse buying would probably be its archenemy. Yet with all the advertising on every media platform, it's a temptation many find hard to resist. You can increase your odds of doing so by instituting a mandatory waiting period before buying things off your want list. It should be at least 24 hours, but you may want to choose to wait longer. Use this time to ask yourself if you really need this item, if you need to buy it right now or if it could wait a few months, or if you could find it elsewhere cheaper. You might still want to buy it, but often, when the initial "I must have this" feeling wears off, you'll realize it's not the best use of your hard-earned cash.

4. Use coupons whenever possible

Whenever you buy anything, whether groceries, clothing, or hobby items, look for coupons to keep your costs down. Your local newspaper might have some for stores in your area or you can check online if you do most of your shopping there. Many stores enable you to subscribe to their email list for information on sales and coupon codes. This might be a smart play if you trust yourself to only buy what you need, but you're better off avoiding this if you're tempted to buy things just because they're on sale.

You should also tap your credit card rewards points whenever you have enough. But avoid overspending on your credit cards just to earn points. This could cause you to rack up credit card debt that will cost you far more than the rewards you're earning.

5. Save all of your windfalls

It could be a quarter you find on the street, a tax refund, a year-end bonus, or an inheritance. If you don't need this money to pay down debt, put it all toward your savings. Allot a portion of any raises for savings, too. You won't miss it because it's not part of your regular budget and it could give your savings a significant boost. But you never know when you'll get windfalls like this, so pair them with some of the other strategies listed here.

6. Get a side job

One of the easiest ways to save more money is to increase your income and put the extra money right into your savings account. If a raise doesn't seem likely at your current job or you don't want to wait for one, try starting a side business. This could be driving for a rideshare company, selling handmade goods, or performing repair services around your neighborhood. Think about your strengths and talents but also weigh the costs of the side hustle. If you become a rideshare driver, for example, you'll be spending a lot more on gas and putting more wear and tear on your vehicle.

You can write off some of these things as business expenses, but you must also set aside your own taxes when you have an extra job because you don't have regular paychecks the government can take from. Your prior-year tax return should give you an estimate of how much to pay per quarter to avoid penalties if you had your side job last year. Otherwise, you can estimate yours with this worksheet.

7. Pay off debt

Debt can be useful because it can help you finance large purchases today that you might not otherwise be able to afford. But it also takes away money you could put toward your future. High-interest debt, like a credit card balance, is particularly damaging because your balance can grow quickly and you might never eliminate it if you're only making the minimum payment.

Prioritize paying off any high-interest debt, and once you're done, put some or all of the extra money toward saving. Sticking to a budget can help ensure you don't end up in debt again.

If you're diligent, all these strategies can help you grow your savings over time.

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