Smart Tips To Start Saving

Even though we live in the land of opportunity, and your average modern family’s quality of life is much better than it has been in the past, managing the household budget as a parent can be an extremely difficult task. We all want to have more money to throw around, but for many people, the hardest part of making their budget go further is simply getting started! Here are some tips to start saving the right way…

Keep Tabs on Your Expenses

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The first step you need to take in making your money go further is figuring out how much you spend. From here on, start keeping track of all your expenses. This really means all of them. Every coffee, every snack, every morning paper and every little treat you pick up while grocery shopping. Ideally, you’ll be able to account for every single penny. Once you have this information, organize the money you’re spending by category, such as car costs, groceries, utilities and your mortgage. Your credit card or bank statements can be a big help with this. Total up each category, and you’ll have a great foundation for moving ahead with your savings goals.

Draft a Budget

Now that you have a clear idea of what you spend on a regular basis, you can start organizing your household expenses into a solid budget. This budget should outline the way your expenses stack up against your dependable income. This will allow you to plan your spending over a month or so, and limit any kind of overspending. Aside from your monthly expenses that you know are going to come along, try to estimate and factor in less common expenses, like vacations, Christmas shopping and car repairs. There are countless guides out there, not to mention a lot of apps, that will help you create an airtight budget for your household.

Plan to Save

Once you’ve drawn up a budget, add a “savings” column to it. Most financial experts recommend that you put away 10-15 percent of your income into savings. If your household expenses are so big that you can’t afford to save this much, then you may need to look for ways you can tighten your belt. Set yourself caps on paying for non-essential things, such as home entertainment or eating out, or start hunting for some resource that will allow you to save on these luxuries. Generally, you can save a large amount over time by saving a little here and there.

Set your Priorities

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After your income and non-negotiable expenses, your personal goals are going to be the biggest factor in the way you manage your money. It’s fine to save for some smaller material luxuries, but make sure you don’t lose sight of the big long-term goals, like your retirement or your kids’ education. Setting these goals, and listing them in order of priority, can give you a much clearer idea of where you should be saving. For example, if you know you’ll have to replace your car in the future, you can penny-pinch on maintaining your current one.