Make Saving Money an Addiction

Right now, we’re all being bombarded by bad news about the economy. Things look bleak everywhere!

Now more than ever is the time to make saving money an addiction.

Maybe you don’t have a lot of money to save right now. You might only be working part-time, or you may have plenty of expenses to worry about. But putting some money away for a rainy day is a good habit to establish now so when you have more money available you can save more money.

Here are some strategies that can help you get into this important habit:

Join a Christmas club

Many employers participate in Christmas club programs which automatically deduct a portion of your wages and deposit them in a bank savings account. Around October, you get a check for all the money you’ve saved. This is a good way to force yourself to save if you’re reluctant. Once you’re used to have $5 to $10 less on each check it won’t be hard to save when you don’t have an employer remove the money for you.

It may be too late to participate this year, but find out now if your employer offers a christmas club. If not, you can setup one on your own by auto-debiting a savings account each month.

Setup an online savings account

Online savings accounts are great. One, you get a higher return than you likely would at your normal bank. And two, because the transfer can take a day or two, it makes it much less tempting to dip into for a purchase your don’t really need or an emergency that really isn’t one.

Make sure sure to setup an auto transfer for however much you want to save each month. Set it up right after your paycheck comes in. Don’t promise yourself that you’ll set aside money to add in later. It won’t happen. Be realistic.

Setup A Budget

Budget seems like a bad word to most of us because it tends to mean sacrificing what we want. But you have to change your mind about that budget first. While you may be sacrificing a new Hollister sweatshirt or music downloads from iTunes or the latest Xbox 360 video game, you will actually be giving yourself greater peace of mind and security down the road.

Setup a simple budget online for free at Geezeo or Wesabe.

Avoid Using Credit

While credit cards can be handy we have car trouble or need antibiotics for an illness, they can be our biggest enemies when it comes to frivolous spending. Keep those credit cards locked away for emergencies. Freeze ‘em in ice if you have too!

Remember what you buy today is going to end up costing you for months or years thanks to the high interest rates. And those minimum payments could be earning you money if you put them in your online savings account.

Save your change

While it might seem cliché to save all of your change, it’s actually a good way to put aside some cash for a rainy day.

Think about it this way: if you use $2 every day to buy a $1.25 soda from a vending machine and you save that 75 cents you’ll end up with almost $23 at the end of one month. That’s roughly $275 per year. Now imagine what you could save if you did that with all of your loose change.

Saving money is a habit so start getting addicted to putting money away now so you’ll have it when you really need it.

Tagged as: budget, credit cards, saving money, savings account