With the New Year, many people set resolutions that are health-, relationship-, or even travel-related. But one of the of most common New Year’s resolutions people tell me is that they’d like to “save money.”
Improving your finances can be beneficial to not only your bank account but your health as well. However, “saving money” isn’t just as easy as keeping a change jar handy. So, here are 5 strategies to help you reach that New Year’s resolution to save.
- Create a budget and stick to it - The most comprehensive way to saving money, this strategy usually gets dropped the quickest. More often, people are too strict and don’t provide enough flexibility to account for emergencies or unforeseen financial obligations.
- Key to success: consider a monthly or even weekly budget, and give yourself lots of financial flexibility to handle emergencies.
- Pay off a loan or credit card early - Consider how much money you could save monthly if you didn’t have that payment to make. Factor in your debt’s APR, and you could easily save yourself hundreds of dollars this year.
- Keys to success: increase the payments to your loan/credit card’s principal, and/or make one big push to pay off the debt entirely.
- Audit your subscriptions - You’d be surprised how much money you spend monthly if you sat down and analyzed of how many services you subscrib to. Netflix, Hulu, cable TV, cell phone, Amazon Prime, and even the annual fee for a credit card adds up over time.
- Key to success: list out all your subscriptions on paper and analyze if these services are important to you. Even cutting out one or two can save you hundreds of dollars a year.
- Start investing now - With the stock market surging, it’s a great time to start investing - but you don’t have to go out and buy stocks. If you’re not contributing to a retirement fund (e.g. a 401(K), 403(B), Roth IRA, etc.), you’re really missing out. And if you are contributing to a retirement fund, by slightly increasing your regular contributions (in this bull market), you can make your money go further.
- Key to success: consult a certified financial planner to better understand your options and how you can take advantage of this surging market.
- Create or pad your emergency savings - It’s highly recommended that you have at least a $1,000 emergency fund set aside. However according to a report from GoBankingRates, “69% of Americans have less than $1,000 in savings, including 34% with $0.”
- Key to success: creating an emergency fund is not impossible - just spread it out over the entire year. If you just saved $20 a week (by cutting out extra expenses,) over 52 weeks (or the end of this year,) you’d save $1,040!
Regardless of what strategy you use, saving money is an important endeavor to start (at the beginning of the year, or any time you can). And once you accomplish this resolution, you’ll not only be proud of the results, but you can reward yourself too (but don’t splurge)!! Kue Lee, MBA
Community Medical Centers Disclaimer: I am not a financial planner and do not have any material interests in the companies or stocks mentioned. Additionally, all content mentioned in this article is not to be considered financial advice and is solely intended as entertainment and editorial.