Tips for Saving Money – Create a Budget
Tips for Saving Money – Create a Budget Now
tips for saving money to change that.Let’s begin by stating one important statistic…US citizens in general not very good savers. It’s a known fact and there’s no point in trying to white wash it. For the current year of 2016, the average rate of savings in America was 5.6%. Not very impressive. We offer these
According to the Bureau of Economic Analysis, the high income earners save a lot more of their income than the middle income earners. The middle income earners actually save a very small percentage of their incomes, practically nothing. Why is that? We all are aware that we need to be saving more, and yet we don’t.
One of the reasons is that in our culture, it seems that the saying “why spend tomorrow what you can spend today”, pretty much is the norm. We see our friends and acquaintances buying large homes and SUV’s and we have to keep up.
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Television ads and other media emphasize spending and creating debt instead of saving for the future. A substantial portion of this spending is financed by consumer debt. You can find tips for saving money almost anywhere, but do we listen?
The USA now has the dubious honor of leading the rest of the world in household debt. This insanity of trying to keep up with your neighbors or friends and acquaintances has already taken its toll.
With married couples, both have to work full time jobs, and in many situations, part time jobs as well, to be able to meet their expenses. Many have no savings plans for the future.
Think back to your youth when you began a working career. You were told that social security would be there to provide for your retirement years. This system has been mishandled in the worst way and is well on its way to insolvency, if not already there.
Most employers today can’t afford to maintain a pension plan for their employees. Some put in a 401(k) plan and contribute a small percentage, but many employees need every dollar they earn for expenses.
I’ve written several articles emphasizing that all schools should have courses on personal finance and budgeting. This should start in grade school and be expanded to economics in high school. Mention a course in economics to a high school student and he thinks you’re talking about a foreign language.
So many adults seem to be financially illiterate. They cringe at the mention of the dreaded “B” word (budget), and don’t understand why they need one. If you don’t know where every dollar is going, then how can you possible save for the future?
The golden rule of budgeting and personal finance, is to pay yourself first. As obvious as this rule is, we do just the opposite. We pay everyone else first and then save if anything is left over.
Unfortunately today, nothing usually is left over. Younger couples have a large mortgage, one or more large car loans, and let’s not forget those student loans that financed their education.
It seems like procrastination is the norm for many of us. We make promises to our self that we’ll start setting up a budget next month, but something always pops up to change that. The sooner that you take that big step in creating a workable budget, the sooner you can begin to pay yourself first.
It really isn’t that hard to begin paying yourself first. One way is to have your employer set up an automatic withdrawal from your pay for your savings account. If he offers a 401(k) plan, do your best to max it out and take advantage of the extra employer matching contribution.
We can’t emphasize any stronger, create a budget now and take control of your spending. Find out where some of your dollars are being wasted on things that you don’t really need.
Allocate that to a savings plan in your budget. We recommend a minimum of 10% for your savings. If your expenses don’t permit 10%, then start at 5% and work your way up as you eliminate some expenses.
Be especially careful when shopping at the mall or even in your favorite grocery store. These merchants are highly trained to get you to “impulse shop”. They know how to get your attention and how to make you spend more than you planned.
Once you develop a savings plan, you’ll feel those positive psychological benefits. Just knowing that you now have a plan where you’ll be able to retire one day will give you peace of mind. Please comment below & let us know your opinion.
Don’t put this off any longer…create a budget now and start paying yourself first. Eliminate the wasteful spending and stick with your budget. You’ll be glad you followed these tips for saving money when many years down the road you decide to retire.