Today’s awesome new post comes from Anum Yoon who runs Current on Currency, a personal finance blog for millennials. Once have been “terrible at budgeting,” she now, “has taken full control of her finances.” Catch her updates on Twitter @anumyoon
8 Budgeting Tips That Will Motivate You to Ramp up Your Savings
Let’s face it: Some of us are better at budgeting than others. While there are some people who never seem to have enough money, others are plagued with poor or reckless spending habits. In either case, effective budgeting can help you gain some financial traction and ramp up your savings account for the future.
1. Create a Budget to Begin With
You’d be surprised how many people don’t even make a budget to begin with. It doesn’t matter if you plan this on a weekly, monthly or even daily basis, but it’s critical that you establish a consistent budget and stick with it. Not only will this lead to more money in your savings account, but it will also help you maintain some peace of mind.
2. Avoid Spontaneous Purchases
Impulse buys and unplanned purchases can be real budget killers. Simply put, if it isn’t already a part of your budget, don’t buy it. Exceptions can be made for emergency situations, but extraneous items and spur-of-the-moment purchases will only hamper your ability to build a solid savings account.
3. Turn off Electronics at Night
How many electronic devices do you leave running while you sleep? Clock radios, nightlights, fans and even televisions are common sleep aides, but they can wreak havoc on your utility bills. Even smart appliances that put themselves to sleep or regulate their own energy consumption can be costly over the course of time. Most of us will see a significant reduction in our monthly utility bills simply by turning these devices off at the end of the day.
4. Use Automated Payments to Pay Bills on Time
Most credit cards and utility providers offer an automated or recurring payment option for their regular customers. These systems ensure that the utility companies receive their money on time, but they can also be advantageous to those who are trying to save money in the long term. Not only are these platforms convenient for everyone involved, but they can help you avoid late charges and even improve your credit score over time.
5. Use Cash as Often as Possible
ATMs, electronic payment systems and credit cards can be great tools when used correctly and intelligently. Unfortunately, they can also lead to overspending and, in some cases, massive debt. If you find yourself in this situation, or even if you’re just looking to save a little bit of money, try making the transition back to cash. In this case, your spending is over once your wallet’s empty — it really is that cut and dry.
6. Buy in Bulk
Bulk stores, including the large warehouse chains, can be a great solution when trying to save money on everyday goods. Most have a selection of food, snacks, soda, napkins and toilet paper, all of which are essentials in nearly every household. Although you might want to do some research to ensure that you’re actually receiving a discount by purchasing a specific item in bulk, this is a great way to pad your savings account, reduce waste and help the environment.
7. Utilize Customer Loyalty Programs
There’s no denying the fact that the top brands of today are actively competing for your business. For better exposure, many offer their own loyalty programs that reward customers for frequent purchases or visits. Potential rewards can include anything from special discounts and coupons to free merchandise. Some companies offer lavish vacations or other accommodations as even more incentive for their repeat customers.
8. Spend More Time at Home
Consumers spend a lot of money going out to eat, frequenting local bars and visiting friends. To help save some money, many are now spending more time at home. Inviting your friends or family over for cocktails and dinner is far more affordable then visiting a fine restaurant, and you can still achieve that feeling of connectedness you from hanging out with peers.
Smart Budgeting Leads to Smart Spending
Those who have been able to stick with a consistent budget over an extended timeframe often find that it becomes easier to control their spending habits. Smarter spending ultimately leads to more money in your savings account, which can be used for a vacation, retirement or even as an emergency lifeline when times get tough.