The fight between spending money and saving money doesn't have to be a big, time-consuming struggle. There's also no need to spend hours reading books or listening to podcasts to learn the newest money-saving habits.
Real wealth building just might be increasing the gap between your income and your spending habits, according to Ryan Matteo, Advisor and CFP at Moneta. “Determining whether someone is truly on track requires looking well beyond a single savings figure. It requires understanding the full picture: liquidity, debt structure, savings behavior over time, and how assets are allocated relative to goals,” he said.
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In fact, there are many simple moves you can make today that will help you build wealth. Here are six expert-backed ways to get started doing just that.
1. Set Up Automatic Transfers
Nationally recognized money-saving expert, writer and on-air contributor Andrea Woroch recommended using automated transfers to build up your savings. To start, set up transfers for small amounts, like $10 per week or $25 per month. Set automatic transfers to move those amounts into a separate account so that money is out of sight and out of mind.
"Setting up automatic deposits takes the work out of saving and keeps you consistent," Woroch explained. "Once you start seeing your balance building, you will feel motivated to keep working toward your goal."
2. Plan Ahead
Planning ahead can help avoid making impulse purchases so you can save more money. Include every expense in your budget, no matter how small, to help you stay on track with your spending.
For example, for short-term adjustments, if you're attending a sporting event or concert, do some research beforehand to explore the best transportation options. Driving might not be the cheapest choice.
For long-term adjustments, make sure you are consistently contributing to your 401(k) plans or individual retirement accounts (IRAs) for a better retirement plan. You can also speak to a financial planner to make your planning even easier.
“By evaluating savings rate trends, liquidity, debt composition, and real investment performance together, we can help clients see whether they are genuinely progressing toward their goals or simply standing still,” said Matteo.
3. Pay With Cash
Woroch advocated paying with cash, which can help you avoid making purchases you don't need or didn't plan to make. Since you can't spend more cash than you have with you, cash payments can help keep your spending in check.
She explained that paying with cash doesn't mean that you have to miss out on rewards. With platforms like Fetch.com, you can take and submit photos of your receipts to earn points that you can put toward gift cards from popular retailers.
4. Identify Unnecessary Spending Triggers
Spending a little time identifying your personal triggers that lead to unnecessary purchases can help you understand how to fight those triggers. "For example, if you can't resist a sale, turn off push notifications in deal apps and unsubscribe from store newsletters," Woroch said.
If you often shop when you're bored by browsing popular sites and apps, delete your payment information from those online accounts or social media sites. "This will require you to get your credit card and may be enough time to make you rethink the purchase or simply deter you from buying," she explained.
5. Create Separate Bank Accounts for Different Purposes
Consider setting up different bank accounts for specific purposes. For example, create a checking account for bills, another account for monthly spending, and a separate savings account for short- or long-term savings goals. You can even put your checking into the savings account of your choice.
Woroch highlighted the value of opening a high-yield online savings account as well. With a high-yield account, you can earn higher amounts of interest on your money, and your savings will grow faster.
6. Review Your Monthly Bills
Take a few minutes to sit down and review your monthly bills to identify additional ways to save. "Begin by negotiating bills with current service providers and asking about any new promotions you may qualify for or discounts for setting up e-billing," Woroch recommended.
Cancel any subscriptions that you don't use, pause memberships, bundle your insurance policies and regularly review service rates with competitors to see if you could save money by switching your providers. Periodically review your bills to identify any areas where you're overpaying or paying for services you don't use, and you could save money throughout the year.
Paige Cerulli contributed to the reporting for this article.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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