Having a good amount of savings is important to become financially secure and be prepared for emergencies. While having a fair amount in your savings account ensures a good safety net, 50% of Americans still cannot afford a $400 emergency expense without selling something or borrowing money.
More alarming than that, 30% of the Americans reported having zero balance while 62% have less than $1,000 in savings. In order to live comfortably while paying your mortgages or dealing with emergency expenses, here are three easy ways to increase your savings:
Pay Yourself First
Were you the kind of person who pays the bills first and saves what is left? It may be the traditional way of saving money but this time, try to pay yourself first. Whether it’s a hundred dollars, 50, or 10% of your paycheck, assign an amount for your savings before paying your bills, your mortgage, or other expenses after. This way, you get to save a certain amount per month and work with the remaining budget that you have.
Do It Automatically
Once you’ve set an amount for yourself, do it automatically. Have the bank or your employer automatically deduct this amount from your paycheck and transfer it to a savings account. Just imagine, automatically saving $25 a week turns to $1,300 in a year.
Plan Your Spending
Create your budget. Plot your income versus your expenses. Prioritize the non-negotiable expenses, such as utilities, mortgages, credit card bills, and groceries. Re-examine your spending habits and remove the unnecessary, if possible. Review your list regularly to see where your money is going.
Starting to save may be difficult at first, but will give you many benefits in the long run. Start small and once you get the discipline, increase it one step at a time. Make saving a habit today.