It is the week we set aside to examine and improve our savings habits.
Saving can feel overwhelming. We are struggling to pay all the bills each month, then some expert comes along and tells you that you need to have three to six months expenses in a savings account. It is easy to throw up your hands in frustration.
Rome wasn’t built in a day and neither is a savings account. Take small steps and that savings will grow over time. Here are some easy ways to trick yourself into savings since we know we don’t let go of spending money easily.
There’s the replacement theory. Examine where your money is going and choose the less expensive alternative. Think of replacing a night at the movies with a stay-at-home movie night. If you watch a DVD as a rental or on one of the downloadable services and eat home-popped popcorn, you’ve saved from $25 to $30. Take that money and sock it into a savings account. If you do that once a week, you are talking big money over the month.
The same practice works with restaurant meals. Bring your lunch from home and save $5 or $7 a day or replace a once-a-week date night meal with a deli meal from the grocery store, saving $10 to $15. If you need the time together away from the house, consider having a dessert and coffee rather than a whole meal. All these mean you’ll spend less by replacing a more expensive alternative for a less expensive one. Be sure to take the difference in spending and put it in your savings account.
Consider the bad-to-good approach. This is a variation on the replacement theory. Forgo a bad habit and put that money in savings. If cigarettes or alcohol are your bad habits, then your health will also improve. But if you indulge in a coffee each morning or a soda or even a candy bar, those, too, add up in expenditures and health consequences. A daily soda adds up to $40 a month, coffee comes in at $90, or a candy bar at $24. Replace them with a less expensive alternative such as taking your soda from home and you will save more than half that cost.
Little things add up. Dump your change in a jar at the end of the day. Or resolve to save all the dollar bills that appear in your wallet or fives, tens, etc. I took a quart jar of change to the bank recently and found that I had saved over $200. Little amounts add up over time. However, make sure you do cash it in. A friend of mine told me this week that she had saved several jars, and they were still sitting in the house. Put the saved money in the bank or credit union.
Practice the fine art of saying no. You don’t have to buy everything you see. A simple no to yourself on that impulse purchase will save you money. Did you know that the average consumer who makes a quick trip to the grocery store purchases 57 percent more items than he or she had planned to buy? That’s a lot of impulse shopping that could easily double your bill. Tell yourself you don’t need these items and bank what you would have spent.
Make it automatic. Setting up an automatic deposit into your savings account is the quickest way to add to those savings. Take a portion of your paycheck and have it deposited into your savings account or set up an automatic withdrawal from your checking account. Either method will help you build your savings account.
Saving money isn’t easy, but it is important that you build a strong financial base. Having a savings account is one way to do it.
Roxie Rodgers Dinstel is associate director of Cooperative Extension Service, a part of the University of Alaska Fairbanks, working in cooperation with the U.S. Department of Agriculture. Questions or column requests can be e-mailed to her at email@example.com or by calling 907-474-7201.