Want To Boost Your Savings? Do These 5 Things -- Whether You Like It or Not
Everyone knows they should save money. But actually doing so takes vigilance, sacrifice and tedious time management. In other words? Zero fun. After all, spending money to buy new Dior shoes is a great time; saving money does not feel nearly as gratifying in the moment.
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However, since setting aside funds inevitably sets you up for success in the long run, it's crucial to put on your grown-up pants and just, well, muscle through. Here are five of the most "unfun" money-saving habits and money moves you really should adopt -- whether you like it or not.
1. Have Regular Money Talks With Your Partner
Natasha and Ray Weefa, financial communication experts at Naked and Rich, understand that communicating with your partner about finances takes time, patience, awkwardness -- and maybe especially difficult if the two of you have opposite money spending styles.
However, they believe, the key to boosting savings is creating shared money goals. After all, if one of you is banking left and the other is banking right, you may be doing more harm than good to your overall financial picture. By fostering teamwork and aligning values, couples are better able to create shared targets and eliminate unnecessary spending.
2. Track Spending for One Month
Tracking spending tends to be monotonous and generally joyless. "But reviewing every payment helps highlight where money is being lost without you realizing," said James Gilliver, chief of operations at Unity Mutual.
He advocates taking particular note of impulse buys, nonessential spending and subscriptions you no longer use. Once you identify wasteful spending, you can eliminate it.
3. Pause Before You Spend
When it comes to nonessential purchases, try waiting 60 seconds before checking out. This method may sound overly controlled and restrictive, but it helps you take your power back. This is because the desire to impulse buy often fades when given enough space.
Per financial advisor and host of The Women of Wealth Podcast, Tracey Sofra's LinkedIn post, pausing allows you to ask, "Does this align with my goals, or am I shopping to feel better?"
4. Automate Savings
It's never fun to reduce disposable income -- so just aim to forget you are doing it. Robert Johnson, professor of finance at Creighton University's Heider College of Business, said one of the best ways to save money is to make it automatic. In other words, before the money even hits your checking account, have a specific amount taken out of each paycheck and automatically re-allocated to savings, retirement, and/or investment accounts.
"Inertia and inherent laziness of people tend to work in our favor," said Johnson. "That is, once enrolled in an automatic savings plan, people tend to stay enrolled."
5. Resist Lifestyle Creep
One of the best ways to boost savings is to live below your means -- especially as your income grows. If you can now afford a Porsche, stick with a Toyota. If you can buy Chanel, why not choose Zara? This kind of discipline can feel unrewarding socially, but the practice helps create financial security.
Moriah Costa of Synchrony.com offered a few tips to prevent lifestyle creep: Create a budget, make a long-term financial plan and immediately put any raises or extra cash into savings. If you wish to gradually add changes to your budget, do the math to make sure you aren't overdoing it. The goal is not deprivation -- just peace of mind.
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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