Once you get into the savings mindset, you might find it gets easier to apply it to other areas of your life and long-term goals. With this in mind, Conway offers the following tips:
1. Automate your savings account: Set up a monthly transfer of cash from your checking account to a savings account. Keeping the accounts separate makes it easier to leave the savings account alone where it can grow.
2. Set up an emergency fund: Separate from a savings account, an emergency fund is designed to see you through unexpected financial emergencies, such as medical expenses, car repairs and other big-ticket, rarely-planned-for bills. How much, how often and where you save is up to you, but it’s generally a good idea to have three to six months’ worth of living expenses set aside in case of a job loss. Even a smaller amount can provide some security.
3. Find your community of penny-pinchers: Thrift is in style, Conway says, “and lots of people are willing to share what has been successful for them.” Check out social media for tips and groups.
4. Get familiar with coupon sites and apps: Explore coupon sites and apps — including browser extensions — that cull the best discounts and deals. Before you buy, try conducting an online search by pairing the store name with “coupon code” to see if any coupons are out there. You can also visit rebate sites for necessary purchases like appliances and search for price-matching apps to find the lowest price on items large and small.
5. Consolidate debt: If you have multiple sources of debt, it may be beneficial to combine them into one payment plan. Depending on what kind of debt you have, a debt-consolidation loan from a bank or a balance transfer of credit-card debt to one credit card can help make it easier to pay down. However, these options are not without risks, including interest rates that rise sharply after a certain time period and hidden fees. The Consumer Financial Protection Bureau recommends consulting a nonprofit credit counselor before making a move.
Just like finding an exercise regimen you like, finding your savings style can be a process. The rewards, however, justify the effort.
This article is not intended to serve as financial advice. All financial decisions, including investments, should be made carefully and potentially with the guidance of a professional financial advisor.