There is no denying that when the country is gripped by an uncertain economy and vast job losses, saving is something people just aren’t making a priority. After all, if you can barely scrape enough money to get by, why would you want to restrict your income further by having savings?
The reality is that having a savings fund can help keep you afloat in various situations, and being able to create good financial habits that include saving money, can help you out both now and in the future.
Savings aren’t just wasted funds sat in a savings account, even though that might be how it feels at times. And being able to have the discipline not frequently to dip into your savings can get you up and running. As can finding ways you can boost that pot and help yourself increase the amount you can save.
This post looks at some of the best ways you can boost your savings.
Learn to Budget
This is the downfall of so many savings accounts. People who start with the best intentions and then cannot keep it up due to poor financial habits.
Knowing how to effectively budget your income and allow enough money for your expenses and savings can give you a starting point. It might not sound fun to budget effectively, but knowing how to budget is vital if you want to be more financially responsible.
Use the 50/30/20 rule where you use 50% of your wages to pay for your needs, i.e., rent, utilities, 30% of your income wants, so your subscription payments or days out, etc., and 20% should be saved. Assigning this 20% on payday to a savings account can help you to build good habits.
Did you know that you are most definitely paying more interest on the debt you owe than you are making in interest on your savings? So, if you have a lump sum saved up and a reasonable level of debt on credit cards, for example, you will be wasting more money by keeping money in your savings and paying off your credit card each month.
Pay off your debt using your savings, stay out of debt, and use the money you were paying for your monthly installments to put back into your savings. Not only will this save your money, but it will also boost your credit score and allow you to save more faster
High-Interest Savings Account
Interest rates aren’t great right now, so ensuring you have the best savings account for your needs is vital to get the maximum benefits of keeping your money with one institution. One of the basics of How to save more money effectively is to know how and where to keep your cash and what will get the best returns for you.
Automate your payments and your savings. Then you will know precisely what you have left to spend once everything is taken care of. So, when your paycheck hits your account, it is automatically used to pay for all of your bills and put money directly into your savings account. This is an effective way of budgeting and staying on top of your spending, so you’re not missing bills or falling behind on payments.