How can you even begin to save? There are so many bills you have to pay, so much expensive stuff you need to buy, and so little time in the day to work. It might seem impossible to save even $100, let alone $10,000, but you can do it. Here’s how.
Ideal Savings Account
A savings account doesn’t have the same rate of interest return that you’d see from even stable investments like CDs and treasury bills. But, still, you want a savings account bulked up to around $10,000. Another reasonable rule of thumb is to have around three months of your income saved up, whichever is higher.
Why Do You Want That?
Not every job offers a severance package. You can’t predict when you might get into an accident that puts you out of work. Sometimes, emergencies just happen. Having money saved up to cover these incidents can help you avoid going into debt to stay afloat.
Just Start Saving
It might sound silly, but you need to just start saving. The sooner you start, the better. It doesn’t really matter what amount you save. Put back $10 per month if that’s all you can afford! Just save it somewhere and let it become a habit. When you can afford more, start putting that much back.
Find Room to Save
You’re probably spending money on stuff you don’t need. That’s not an attempt to be mean to you: you know it if you’re wasting your money. Are you throwing out old food you didn’t finish? Buying fast food every day? Getting new clothes you barely wear? Cut these expenses from your budget and just save that money instead.
Making Changes
Making those lifestyle changes is tough in the short term, but the long-term payoff of having three months of your pay saved up is liberating. The feeling of knowing that you’re covered in case something bad happens is extremely comforting. Much more comforting than that pair of shoes you’re going to wear twice a year.
Employ Saving Tactics
There are plenty of savings tactics you can employ to help pad out your savings account, too. Start using the cash diet to only spend money you have in cash, for one, and just throw the rest in your savings account. Use the 50/30/20 budget and save 20 percent of your income. These are surefire ways to put at least a few bucks back.
Create an Emergency Fund First
First, you want to make an emergency fund. Create a baseline savings account and use these tactics to get it to around one month of your pay. That might sound tough, but you can do it! Having even a single month’s pay laid out in front of you can be a huge help in the event of an emergency.
Investing?
Contrary to popular belief, you don’t need a lot of money to start investing. Once you’ve got an emergency fund going, you can keep bolstering it with mid-term investments like certificates of deposit or treasury bills. These yield around 5% interest, which can help you turn your savings into more money. That’s making your money work for you!
Read More: Are High-Yield Savings Accounts Worth it?
Working Overtime
If you’re really dedicated to getting your savings account bulked up to cover unexpected bills, consider putting in some extra work to earn more money. Work overtime, get a side gig, or just find some things around the house you can sell. These are all surefire tactics to earn a few extra bucks you can stash in your savings.
Read More: 10 Money Habits That Millionaires Stick To
Make it Happen
It’s not impossible to save up $10,000. You can do it! And, once you do, you can keep up your savings habit and just keep investing your money. You’d be amazed at how great of a habit it is to put money back! You can cover your own expenses, be prepared for the future, and start really growing your wealth. Who wouldn’t want that?
Read More: 10 Creative Ways to Start an Emergency Fund
