Spending is the easy part of money management. Who doesn’t love the feeling of instant gratification?
But saving money? Sigh.
Just the thought of saving money can incite a myriad of thoughts.
“I don’t make enough money to save!”
“I’m bad at saving money.”
“Saving money sucks.”
While saving money may be tough, it’s an important part of having a strong financial foundation. According to a recent Bankrate survey, 24 percent of Americans owe more on their credit cards than they have in emergency savings.
Life is full of unexpected surprises and having money saved up can help you deal with these occurrences and stay calm, cool, and collected. Without any money saved up? A small thing is suddenly a crisis.
But it’s not just those unpleasant expenses that you should save up for. You can also save up for the fun stuff, like that once-in-a-lifetime dream trip you’ve been thinking about or those new set of wheels you’ve been eyeing.
If you are struggling to save, here are four easy ways to save money.
1. Automate (As Much As Possible)
When you leave saving to your own devices, it can be hard to create a savings habit. After you pay all your bills, make payments on your student loans, etc., it may feel like you have nothing left over.
But the key is to pay yourself first. This remarkably simple concept has a very powerful impact on your finances.
Commit to paying yourself first and use the power of automation to save. By setting up automatic transfers from your checking to your savings account, you’re getting rid of the mental labor it takes to actually commit to saving. While it may seem scary at first, you’ll hardly even notice it.
Here’s what to do:
- Decide what percentage of your income you’d like to save. Many personal finance experts advocate for saving at least 10 percent of your income. If 10 percent feels like a daunting amount, start with 1 percent. So, if you make $2,500 per month, you’ll save $25 each month. Save what you can, but commit to it.
- Pick a date when you want the funds transferred. One easy option is the day after your payday.
- Choose a frequency. You can choose to save money monthly, bi-weekly, or weekly.
- Schedule the automatic transfers!
After employing these tactics, you can essentially “set it and forget it.”
I do recommend reevaluating your savings amount and goals with any big life changes such as a pay increase, move, or job loss. The amount you save doesn’t have to be set in stone and can be flexible and adaptable to your life.
2. Try Using Digit
If you’re looking for another way to automate your savings, consider using a service like Digit. Digit is a free service that helps you save money automatically.
How does it work? According to their website, every few days Digit reviews your checking account to look at spending patterns and transfers a few dollars to your Digit savings account.
Instead of coming up with a number on your own to save, Digit automatically figures out how much you can afford to save, depending on your account balance and spending habits. The amount Digit transfers is small — usually between $5-$50 every few days.
The good news is that Digit has a no-overdraft guarantee, so you won’t need to worry about overdraft fees.
The bad news? You don’t accrue any interest on your savings.
Digit has no fees, no minimums, and allows unlimited transfers — which you request via text message. This service is geared towards people who struggle with saving and really want to have a hands-off approach.
3. Create a Values-Based Budget
Do you dread the B-word? The word budget can feel restrictive — like a diet that doesn’t work. You feel guilty if you go over budget and it feels like a constant numbers game. One of the ways to come to terms with your budget and effortlessly save is to create a values-based budget.
One of the ways to come to terms with your budget and effortlessly save is to create a values-based budget.
A values based budget aligns your spending and savings goals with your values. If you’ve ever regretted a purchase or felt like you wasted money unnecessarily, you’ve probably experienced spending money on things that aren’t aligned with your values.
By creating a values-based budget, you consciously commit to cutting out things that don’t make you happy, don’t make your life easier, and don’t help you in some way. In their place, you focus relentlessly on the things you value.
For example, I value travel over a lot of things. Because of my love for travel, I have eliminated expenses that don’t serve me the same way.
I don’t have a car, a gym membership, or cable. Just doing some rough math, avoiding just these expenses probably saves me at least $3,000 per year.
While it may seem like I’m depriving myself of the good things in life, it’s really just me spending on my values. By doing so, I can focus on my student loan repayment and enjoy a nice jaunt abroad now and then.
Here’s what you can do:
- Make a list of the things that you value in your life, in order of importance.
- Look at your current budget and spending habits. Are there areas you could cut back on to fuel your true goals and passions?
- Save for your future goals, based on your current values. This can make the saving process inspiring and fun instead of boring and chore-like.
A values based budget makes it easier to save and spend on the things that really matter.
4. Create Savings Buckets
All the tips I’ve listed above have made saving a whole lot easier for me. But this next technique totally revolutionized the way I save.
When I first started automating my savings, I kept one large chunk of money in a savings account. I would transfer money haphazardly when there was an unexpected expense or something that I wanted to buy. I felt very unclear about my savings goals and what the money was actually for.
That is until I discovered Capital One 360. They allow you to have up to 25 savings accounts for all of your financial goals — think of these like savings buckets. My favorite part is that you can nickname your accounts, so you know exactly what the money is for.
I have a savings account for my emergency fund, taxes, travel, health expenses, moving fund, etc. I automate a certain amount to these savings buckets each month, in order to reach all my savings goals.
This is all very easy with Capital One 360 as they have a Goals feature that allows you to set up target balances and a time frame to reach your goals. I love it because it’s a simple way for me to save for all my goals and quickly see the progress — without all the confusion of having one lump sum.
Saving money doesn’t have to be hard or feel like a chore. If you feel like you are struggling to save, use these tips so you can start saving effortlessly and spend your time on the things that matter to you.
What are your favorite easy ways to save money?
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.30%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.69% – 7.21%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|