Resolution #3 – Create a Savings Plan
Published on 1/3/2020
Saving Now Can Pay Big LaterTo be fiscally fit, it is important to develop discipline not only in the near term by sticking to a spending plan, but also for the long term by following a savings plan. Having extra money put away provides a security net for those unexpected situations that can come up and can empower your dreams.
Here’s an emergency savings regimen to help you get started:
After mapping out your spending plan, it’s time to look for ways to save. Many think that to save you have to have a lot of extra money. Not true. Even if you only have $5 or $10 left over each month, you can begin saving.
Next, start cutting out places you don’t need to spend. This might include making more meals at home instead of going out (about $3,000 per household goes to dining out every year) or canceling a streaming service. Splurges are a big deal when it comes to cutting costs. Think of how much money you spend every time you go get your hair cut. This includes men and women. In 2019, the average cost of a hair stylist was between $60 and $100. What about manicures and pedicures? That’s an extra $25-$60 every visit.
Assuming these are done once a month, that’s potentially $1,668 a year that could be saved. Take a look at the numbers.
This might not seem like much, but these little things can add up over time. Experts say a good rule of thumb is to have between 3 and 6 months’ worth of your salary saved in an emergency fund. No doubt with some discipline you will be able to find several places where you can tighten your financial belt by either lowering spending or cutting it altogether. Being prepared might not be fun, but when something does happen, you’ll be happy you did.