The hardest thing to do is save money. We all talk about it, but few of us actually do it. And living paycheck to paycheck isn't really living, is it?
There are no fun vacations in the future, no bigger houses, newer cars, nothing because you couldn't put a few dollars aside for a rainy day.
1. Pay yourself first
Right now is the time to change all of that. Go to your online banking account and open another savings account if you don't have one now. Start up an automatic payment plan for that account. Every payday is put into this account for $25.00. If it's an existing account, make sure only you can make any withdrawals from the report, even if it means taking your significant other's name off it (which is why, sometimes, it's just easier to open a new account!) so that the money saved can only be accessed by you.- Your money, your savings responsibility.
- Your money is paid first to you.
- And a small amount won't affect your daily life, will it? Right, you'll do fine.
2. Setup a sensible budget and stick to it
The hardest part of saving money is first understanding where it all goes. You have money and a steady paycheck, but how do you end up with nothing just before the next payday? You don't know… right?- So, from this moment forward, you will get a receipt for everything you buy, everything you pay for, everything that lessens your wallet by a dollar, a dime, a penny.
- You can only save money if you know where the money is and where it goes, right?
- Once you have 30 days' worth of expenses, of money gone, you need to categorize your spending and start the actual budgeting process.
The categories are:
- Must Pay: utilities, rent/mortgage, car loan, cable/satellite/TV, food, clothes, phone, internet, etc
- Daily Treats breakfast/lunch/dinner/snack foods, coffee/tea/drinks purchased outside the home during the day/night/work shift, newspaper,
- Impulse Buys: gifts, snack foods, convenience items
- Important Stuff You Can't Do Without taxi/bus/mass transit
Add to these lists as you need to, but refrain from lying to yourself about what belongs where. How much did you pay for coffee over the last 30 days? Or the daily newspaper? Or long-distance phone calls? As the list grows, so does the money evaporate put on your wallet and savings.
3. Discover your eBay Potential
Like pack rats, we save old things with no emotional value left to them, but we have this stuff just because we can.Well, it's time to dust off this hoard of stuff and sell it to the highest bidder. One man's trash is another man's treasure, and in this world of online, lightning-fast transactions, it's time to ship some of your crap to the far reaches of the planet to add some easy, laying-around cash to your savings account.
- eBay it all, and change your space-wasting junk into money.
4. Maximize Your Income Potential
Are you getting paid what you should be at your job? Do you even care that you're underpaid? Now is a great time to check out similar positions at online placement services and career classified ads. Prep your resume, update it to reflect your current skills and responsibilities, and take a hard look at your industry or classification. It may be time to change workplaces if you're within the median range for salary or dollars per hour.Is your time well spent? Do you pursue your vocation with additional learning, or are you wasting your time in worthless pursuits? Are you maximizing your potential earnings capability? Are you doing what you can to maximize income through time spent at work and play? These questions may spur you to look hard at your job and free time. So spend the time doing just that. Now.
5. Learn to invest in stocks and bonds
You earn your money; what does your money earn for you?While being a significant stock player may not be in your future, once you've started saving some money, buying stocks in "solid" companies (the current downturn notwithstanding), and adding a little n=bit of stock ownership, company ownership, with your savings can significantly increase the income that your savings earn you. With caution and a minimum exposure to loss, you can learn to invest in stocks, just as your savings are an investment in the place where you have the account.
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