We’ve all heard it before — “stop eating out,” “stop splurging on clothes,” or “stop buying things you don’t need.” Easier said than done though, amiright? After hitting my 25th birthday, I started freaking out at the fact that I had little-to-no money in my savings account and struggled to keep money in my checking account! This has resulted in some serious budgeting (ahh, the dreaded “B” word!), retail restraint, and becoming a little more mindful of my spending habits to reach financial freedom.
Now that the craziness of the holidays are over and the Black Friday and After-Christmas sales have stopped draining our bank accounts, you may be thinking about how you can save a few bucks this year. And while saving money is one of those necessary parts of life (adulting), it’s not as easy as just opening up a savings account (unfortunately).
So, I wanted to share a few money saving tips that have helped me along the way.
Keep reading for 5 money saving tips to help you save up this year!
Use the envelope system.
It’s so easy to swipe that debit card or transfer funds from one Venmo to the other. But having cold, hard cash in your hands can really put your financials into a tangible perspective. With this method, you use cash for different categories of your budget, and you keep that cash tucked away in envelopes — and no touching! You can see exactly how much money you have left in a budget category just by taking a quick peek in your envelope. It’s one of the easiest ways to save money!
Let’s say you’ve set a budget of $400 a month for groceries. When you get your first paycheck of the month, take out $200 from your bank account and put the cash in an envelope. On that envelope, write out “Groceries.” When you get your second paycheck, do the same thing again and put that $200 in the envelope. That’s you’re $400 food budget for the month! Simple, right? No money — seriously, zero money — comes out of that “Groceries” envelope except to pay for food at the grocery store.
This method takes a lot of discipline, but it’s worth it! And you can easily apply this to clothes shopping, date night, brunch with friends, etc.
Download a money-saving app.
While there are a lot of different options out there, I personally like using Qapital. You link the app to your debit card and it rounds up to the nearest dollar every time you make a purchase. It then puts the extra change into a designated savings account (or a goal) that you can earn 0.1% interest on — which is low, but better than nothing!
But my favorite part about the app is that you can create “rules” that helps you to save more! There’s the “Set & Forget,” where you set up a daily, weekly, or monthly deposit to make saving automatic; the “Apple Health Rule,” where you can reward yourself for hitting fitness goals; the “Guilty Pleasure Rule,” where you can set a certain amount to go towards your savings account whenever you buy the things you’re trying to resist (my favorite), and seriously so many more! There’s even customizable goals you can set up with things like the weather, social media and more. (They also offer their own debit card which helps you save even more. I haven’t switched over to it, but I’ve been thinking about it.)
Use the 50/20/30 rule.
This is probably the most well-known system to use for saving money. 50% of your income goes toward fixed essential items (rent, insurance, utilities, gas, student loans, etc.), 20% goes into a designated savings account, and 30% is for lifestyle expenses (going out to eat, hobbies, entertainment, etc.).
The 30% is flexible because, unless you’re really great at living within your means, you may have less than 30% remaining after your 50/20. Think of those first two tiers as fixed absolutes — no budging! What I love about this method is that it really forces you to reevaluate your spending habits and choices.
Designate no-spend weekends.
Once a month, put a “no-spend” weekend on the calendar. This means you’ll have to get creative with your time and try to find activities that are free, such as hiking or hitting up a free museum.
Aside from the groceries you already bought for the week, no buying additional items — including your daily trip to Starbucks. It’s an easy, small step to take in saving a few bucks each month. But be sure to plan for your meals and entertainment so you can stick to it!
Set a theme each month.
For example, in February, try giving up alcohol and put all of the money you would have spent on wine or cocktails for the month into an envelope. In March, pack your lunch every day and pocket those funds. In March, commit to not buying anything new besides necessities for the month. And so on and so forth. Get creative with this method!