As the end of the year approaches and you start making New Year’s resolutions, do not overlook including some money-saving tricks. Whether you want to save more money, pay off your credit cards, cut spending, or start a retirement account, it is important you create a plan and follow through.
Trick #1: Create a budget and stick to it.
The easiest way to stick to any financial resolutions you have this coming New Year is to start by creating a budget. Make a list of all of your monthly expenses, including housing payments, utility bills, groceries, gas, etc.
Do not forget to include quarterly or annual expenses like property taxes, auto and home insurance premiums, and so on. Subtract your total monthly take-home income from your expenses to see how much you should have left each month. You can use this money with any of the other tips below.
Trick #2: Pay down your credit cards.
There are different methods to pay down credit card debt. You could start by paying off the cards with the lowest balances. Once they are paid off, use the money you used to pay toward these to pay more than the minimum due on your larger balances. By reducing your credit card debt, you are saving money because you are paying less interest each month.
Trick #3: Save all of your change.
Anytime you pay in cash and get change pack, toss it into a jar. At the end of the month, deposit all of your change into your share savings account.
Trick #4: Cut out unnecessary expenses.
Review where you are spending your money and look for any expenses you could eliminate. For instance, could you drop down a tier or two on your cable TV package or cellular plan? Use any savings gained after cutting expenses toward your resolution goals.
Trick #5: Don’t spend all of a windfall.
It can be tempting to spend your entire tax refund, a holiday bonus, or other unexpected income. Instead, you want to divide it up into quarters:
- Use one-fourth (25%) to pay off debts.
- Put one-fourth (25%) into your savings account.
- Put one-fourth (25%) into your retirement account.
- Spend one-fourth (25%) on something you want to do, like a family vacation or home improvement project.
Trick #6: Remember to pay yourself.
Every pay period, reward yourself by setting aside at least 5% (or more) of your income and using it toward your resolution goals. Use it to pay down your debt, put it into savings, or invest it toward your retirement.
Bonus TIP: Remember to adjust your budget to reflect your reduction in monthly expenses as you pay down credit card balances and eliminate unnecessary expenses.
For more money-saving ideas or to open a share savings account, please feel free to stop by your nearest branch of The People’s Federal Credit Union or contact us at 806-359-8571 today!