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20 Mini Money Hacks To Save You A Lot

20 Mini Money Hacks To Save You A Lot

Do you like to save money? Dumb question, right – you work hard for your money, so you want to keep as much of it as possible. There are plenty of ways to save money without spending hours to do so. Here are 20 simple mini money saving hacks that can help you save a lot. Let’s get straight to the point and start saving…

1. Put your savings on auto-pilot

You can automate just about everything; and you should. It takes a lot of weight off your shoulders and frees up your time. Saving is easy to automate with online banking – simply set up an automatic transfer from your checking to your savings each month… Or try Digit! Digit is a free tool that automatically transfers different amounts from your checking account to your savings. It’s an intelligent tool that knows when you can and can’t afford to save; but don’t worry, if for some reason Digit causes you to overdraft by taking too much, they will fully reimburse any fees and charges (though it’s so smart I’ve never even heard of it causing an overdraft).

2. Make a meal plan

When people ask how my wife and I feed our family of six for under $400/month, I have two words: “meal plan”. Planning your meals will save you a ton. It eliminates buying extra food that you don’t need. It also helps you plan ahead for making more affordable meals, rather than buying what looks good when you’re at the grocery store.  I’ll go over how we make our meal plans even cheaper in the next point.

3. Plan meals around sales

You don’t have to spend hours going through sale papers to find the best deals on everything. Just make your meal plan, but leave the specifics open. For example, one of your meals could be a stir-fry, so you need meat, veggies and a grain. When you get to the store, buy the best-priced meat and veggies. Then look for a grain, like rice or quinoa and buy whatever is the most cost-effective, weighing the price and health benefits.

4. Drink more water

This may seem obvious but the statistics show that it isn’t. You’ll save a lot of money if you stop buying the 24 packs of soda and bottles of juice. Bottled water is cheap – tap water is cheaper. There are many great options for filtering if you’re not a fan of the tap taste. Weigh the cost and see whether you prefer bottled or tap. When you’re eating out, a family of six can easily save $12-$20 per meal just by drinking water instead of soft drinks.

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5. Set an automatic budget

There are plenty of free services like Mint and Personal Capital that allow you to link your accounts and automatically track your budget. If you’re not one for spreadsheets and inputting numbers, this is for you. You are able to view it and oversee the budget, but once you set your categories everything is automatically sorted for you. Occasionally something will go into the wrong category, but it’s easy to switch it and change the category for all future transactions.

6. Set a plan to pay off debt

If you want to get out of debt, you need a plan. There are a few options, but the two most common are the debt snowball and the debt avalanche. How do they work? For the debt snowball you simply write down all your debts from the smallest balance to the largest, then you use any extra money to pay off the smallest balance first. Once that’s paid off, take that payment plus any extra money, and put it on the next smallest balance until you’re debt free. With the debt avalanche it’s the same idea, except you sort by interest rate (highest to lowest) instead of by balance.  The debt avalanche will save you more money in interest, but you may prefer the small wins that the debt snowball provides in the beginning.

7. Get a second job

If you’re trying to reach a goal that seems to be taking longer than you’d like, you may want a second a job. It’s not forever; just a temporary job to get past whatever situation you’re in. If you’re in debt a second job is a great way to pay it off faster. If you’re building an emergency fund: get a second job to get it knocked out. The service industry is great for this, such as waiting tables or delivering pizzas. Service jobs are great for maximizing your extra working hours, since you’ll be getting tips and likely making more than you would at a regular hourly job.  If you aren’t able to get a second job then don’t worry!  There are plenty of other ways below to save money without working more.

8. Challenge everything

Challenge every single expense you have. Do you really need cable? What about those magazine subscriptions that you don’t read? Both of them cost money on their own and the ads could possibly persuade you to spend even more. Odds are you can cut something out. Perhaps you’ve been paying for a service so long that it’s second nature? It’s time for a challenge and here’s how to do it:

  1. Write down every single expense you have
  2. Look for expenses you can fully cut out
  3. Find ways to save money on the remaining expenses

9. Compare insurance rates

When was the last time you checked insurance rates? This is something you should be doing annually. The cheapest isn’t always the best, but usually you’ll find that you can get the same coverage for less money if you shop around. Once a year take a look at all your insurance policies. Call around or go online and see if you can find better rates. Most of the time you can!

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10. Use coupons wisely

There are primarily two crowds when it comes to coupons: the first crowd says coupons aren’t worth the time you spend cutting them; the second crowd says coupons are always worth it because they save you money. However, there exists another crowd: the savvy couponers. Be discerning with coupons. It may not be practical for you to spend hours each week cutting them, but you should be on the lookout for coupons that save you a lot of money. Check out popular services like Groupon or Living Social to look for a coupon every time you’re about to spend money. It takes seconds and could save you a lot, especially on services like an oil change or a massage.

11. Review your card statements

Whether you use a credit card or a debit card, review your statements each month. It’s not uncommon for random or bogus charges to appear on your account. It’s easy to overlook these charges when you’re not checking your statement each month. If you have multiple cards, use a service like Personal Capital to link all your accounts. This way you can see all your transactions in one place for an easy review.

12. Start an emergency fund

Emergency funds are something you should set in place to avoid using a credit card in an emergency. When a crisis hits you don’t want to turn to a credit card and pile on the debt.  Debt can turn a crisis into a catastrophe. Dave Ramsey popularized the idea of having an emergency fund instead of a credit card. Dave recommends getting it to $1,000 quickly; however anything is better than nothing. Even if you can just put $50 or $100 in your emergency fund each month, you’re still making progress.

13. Use the 30-day rule

When you’re considering making a large purchase, use the 30-day rule. If you still want it just as much after 30 days, consider making the purchase. Often you’ll find that you no longer care about whatever it is you wanted. This eliminates spontaneous purchases made out of excitement or emotion.

14. Take it down a notch

Set your thermostat one degree cooler or warmer depending on the season you’re in. You will barely notice the difference and a month later you can do it again since you’ll be fully adjusted to the new temperature. According to the U.S. Department of Energy, you can save as much as 1% on your yearly heating bill for each degree.

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15. Don’t replace, repaint

If you’re planning to replace an item in your home, such as an appliance, cabinets or bathroom components; consider painting before replacing. If you’re only replacing it because of the appearance, painting may be your best bet. Anything from appliances and cabinets to sinks and bathtubs can be painted. You just have to buy the right paint. Always make this consideration before buying something new.

16. Know your options

Home Depot and Lowes aren’t the only places to buy home items, just like Best Buy isn’t the only place to buy electronics. Know your local and online options. We almost all know to look online before deciding on a purchase, but you may also be surprised at your local options. Overstock, wholesale and liquidation stores are a few of the places you should check out. Sure they’re hit or miss, but when you find some deals that save you hundreds or thousands it will all be worth it. We were able to buy ceramic tile for less than half the price we previously found, just by walking into a wholesale store that we passed by every day.

17. Keep up with maintenance

Maintaining your home and your vehicle can save you thousands down the road. Regular oil changes, replacing air filters and checking tire pressure will all lead to savings in the future. Likewise, replacing your home filters, being aware of issues and quickly making needed repairs will save you some serious cash. Be mindful and pay attention to general maintenance. Staying on top of maintenance will stop other problems before they happen.

18. Reduce your interest rate

If you have credit card debt, you know interest can be a killer. Call your credit card company and ask for a lower rate. You don’t need some amazing reason to convince them. Many companies will simply lower it because you asked. It’s easier than you may think to negotiate with credit card companies. Often times, they are just happy you’re paying instead of filing for bankruptcy.

19. Give up the expensive habits

If you’re trying to save money, your habits may be working against you. For example, the cost of cigarettes and alcohol can be insane. If you don’t want to completely cut it out, try cutting back. Smoking one less pack of cigarettes each week can save you as much as $40/month depending on the state you live in. When you count the costs of your habits, it may open your eyes to another benefit of quitting.

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20. Get paid to spend

Maximize your credit card rewards by using the right card for your purchase. Some cards offer 5% cash back on gas, while others offer 6% cash back on groceries. Credit card rewards are a great way to earn while you spend, which in return, saves you money. It’s like putting a certain percentage of every purchase into a savings account.

That was quick! Now you’ve got 20 ways to save money so start saving today. Some of these require you to take action, while others mean you’ve got to stop doing something. Whether you’re adding or subtracting something from your life, stay mindful of your spending. You should always know where your money is going, since you should be the one telling it where to go. Stick to your budget, follow these tips and save some money!

Featured photo credit: Cutting Your Spending / Tax Credits via flickr.com

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Last Updated on September 2, 2020

How to Set Financial Goals and Actually Meet Them

How to Set Financial Goals and Actually Meet Them

Personal finances can push anyone to the point of extreme anxiety and worry. Easier said than done, planning finances is not an egg meant for everyone’s basket. That’s why most of us are often living pay check to pay check. But did anyone tell you that it is actually not a tough task to meet your financial goals?

In this article, we will explore ways to set financial goals and actually meet them with ease.

4 Steps to Setting Financial Goals

Though setting financial goals might seem to be a daunting task, if one has the will and clarity of thought, it is rather easy. Try using these steps to get you started.

1. Be Clear About the Objectives

Any goal without a clear objective is nothing more than a pipe dream, and this couldn’t be more true for financial matters.

It is often said that savings is nothing but deferred consumption. Therefore, if you are saving today, then you should be crystal clear about what it’s for. It could be anything, including your child’s education, retirement, marriage, that dream vacation, fancy car, etc.

Once the objective is clear, put a monetary value to that objective and the time frame. The important point at this step of goal setting is to list all the objectives that you foresee in the future and put a value to each.

2. Keep Goals Realistic

It’s good to be an optimistic person but being a Pollyanna is not desirable. Similarly, while it might be a good thing to keep your financial goals a bit aggressive, going beyond what you can realistically achieve will definitely hurt your chances of making meaningful progress.

It’s important that you keep your goals realistic, as it will help you stay the course and keep you motivated throughout the journey.

3. Account for Inflation

Ronald Reagan once said: “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hitman.” This quote sums up what inflation could do your financial goals.

Therefore, account for inflation[1] whenever you are putting a monetary value to a financial objective that is far into the future.

For example, if one of your financial goal is your son’s college education, which is 15 years from now, then inflation would increase the monetary burden by more than 50% if inflation is a mere 3%. Always account for this to avoid falling short of your goals.

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4. Short Term Vs Long Term

Just like every calorie is not the same, the approach to achieving every financial goal will not be the same. It’s important to bifurcate goals into short-term and long-term.

As a rule of thumb, any financial goal that is due in next 3 years should be termed as a short-term goal. Any longer duration goals are to be classified as long-term goals. This bifurcation of goals into short-term vs long-term will help in choosing the right investment instrument to achieve them.

By now, you should be ready with your list of financial goals. Now, it’s time to go all out and achieve them.

How to Achieve Your Financial Goals

Whenever we talk about chasing any financial goal, it is usually a two-step process:

  • Ensuring healthy savings
  • Making smart investments

You will need to save enough and invest those savings wisely so that they grow over a period of time to help you achieve goals.

Ensuring Healthy Savings

Self-realization is the best form of realization, and unless you decide what your current financial position is, you aren’t heading anywhere.

This is the focal point from where you start your journey of achieving financial goals.

1. Track Expenses

The first and the foremost thing to be done is to track your spending. Use any of the expense tracking mobile apps to record your expenses. Once you start doing it diligently, you will be surprised by how small expenses add up to a sizable amount.

Also categorize those expenses into different buckets so that you know which bucket is eating most of your pay check. This record keeping will pave the way for cutting down on un-wanted expenses and pumping up your savings rate.

If you’re not sure where to start when tracking expenses, this article may be able to help.

2. Pay Yourself First

Generally, savings come after all the expenses have been taken care of. This is a classic mistake when setting financial goals. We pay ourselves last!

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Ideally, this should be planned upside down. We should be paying ourselves first and then to the world, i.e. we should be taking out the planned saving amount first and manage all the expenses from the rest.

The best way to actually implement this is to put the savings on automatic mode, i.e. money flowing automatically into different financial instruments (mutual funds, retirement accounts, etc) every month.

Taking the automatic route will help release some control and compel us to manage what’s left, increasing the savings rate.

3. Make a Plan and Vow to Stick With It

Learning to create a budget is the best way to get around the uncertainty that financial plans always pose. Decide in advance how spending has to be organized

Nowadays, several money management apps can help you do this automatically.

At first, you may not be able to stick to your plans completely, but don’t let that become a reason why you stop budgeting entirely.

Make use of technology solutions you like. Explore options and alternatives that let you make use of the available wallet options, and choose the one that suits you the most. In time, you will get accustomed to making use of these solutions.

You will find that they make it simpler for you to follow your plan, which would have been difficult otherwise.

4. Make Savings a Habit and Not a Goal

In the book Nudge, authors Richard Thaler and Cass Sunstein advocate that, in order to achieve any goal, it should be broken down into habits since habits are more intuitive for people to adapt to.

Make savings a habit rather than a goal. While it might seem to be counterintuitive to many, there are some deft ways of doing it. For example:

  • Always eat out (if at all) during weekdays rather than weekends. Weekends are more expensive.
  • If you are a travel buff, try to travel during off-season. You’ll spend significantly less.
  • If you go shopping, always look out for coupons and see where can you get the best deal.

The key point is to imbibe the action that results in savings rather than on the savings itself, which is the outcome. Focusing on the outcome will bring out the feeling of sacrifice, which will be harder to sustain over a period of time.

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5. Talk About It

Sticking to the saving schedule (to achieve financial goals) is not an easy journey. There will be many distractions from those who are not aligned with your mission.

Therefore, in order to stay the course, surround yourself with people who are also on the same bandwagon. Daily discussions with them will keep you motivated to move forward.

6. Maintain a Journal

For some people, writing helps a great deal in making sure that they achieve what they plan.

If you are one of them, maintain a proper journal, where you write down your goals and also jot down the extent to which you managed to meet them. This will help you in reviewing how far you have come and which goals you have met.

When you have a written commitment on paper, you are going to feel more energized to follow the plan and stick to it. Moreover, it is going to be a lot easier for you to track your progress.

Making Smart Investments

Savings by themselves don’t take anyone too far. However, savings, when invested wisely, can do wonders.

1. Consult a Financial Advisor

Investment doesn’t come naturally to most of us, so it’s wise to consult a financial advisor.

Talk to him/her about your financial goals and savings, and then seek advice for the best investment instruments to achieve your goals.

2. Choose Your Investment Instrument Wisely

Though your financial advisor will suggest the best investment instruments, it doesn’t hurt to know a bit about the common ones, like a savings account, Roth IRA, and others.

Just like “no one is born a criminal,” no investment instrument is bad or good. It is the application of that instrument that makes all the difference[2].

As a general rule, for all your short-term financial goals, choose an investment instrument that has debt nature, for example fixed deposits, debt mutual funds, etc. The reason for going for debt instruments is that chances of capital loss is less compared to equity instruments.

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3. Compounding Is the Eighth Wonder

Einstein once remarked about compounding:

“Compound interest is the eighth wonder of the world. He who understands it, earns it… He who doesn’t… Pays it.”

Use compound interest when setting financial goals

    Make friends with this wonder kid. The sooner you become friends with it, the quicker you will reach closer to your financial goals.

    Start saving early so that time is on your side to help you bear the fruits of compounding.

    4. Measure, Measure, Measure

    All of us do good when it comes to earning more per month but fail miserably when it comes to measuring the investments and taking stock of how our investments are doing.

    If we don’t measure progress at the right times, we are shooting in the dark. We won’t know if our saving rate is appropriate or not, whether the financial advisor is doing a decent job, or whether we are moving closer to our target.

    Measure everything. If you can’t measure it all yourself, ask your financial advisor to do it for you. But do it!

    The Bottom Line

    Managing your extra money to achieve your short and long-term financial goals

    and live a debt-free life is doable for anyone who is willing to put in the time and effort. Use the tips above to get you started on your path to setting financial goals.

    More Tips on Financial Goals

    Featured photo credit: Micheile Henderson via unsplash.com

    Reference

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