It’s my Pleasure to welcome Rachel Foxwell, the newest writer for Money is not Taboo. You may already know of Rachel from her own blog, The Latte Budget, as well as her writing for David Carlson’s Young Adult Money. If you do, you know she has great info to share. If you don’t already know of Rachel, then you are in for a treat. Grab a beverage, a snack, or both, and dive into her first post at MinT. I know that you won’t be disappointed in what she has to say. Shin
Rachel Foxwell, The Latte Budget
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If you’ve let your finances slide this year, the new year is the perfect time to refocus your time and energy to your financial goals. The new beginning gives you another chance to finally obtain financial freedom.
Building your savings, in particular, is a common financial resolution. Whether you are saving for college, your emergency fund, vacation, or retirement, there are so many things to save for.
While most of us have no problem setting well-intentioned goals in the new years, we often struggle with the follow through. How can we actually achieve the goals we set? Here is exactly how to set and achieve your savings goals in the new year.
Set High, but Realistic Goals
Take a look at New Years resolutions you’ve attempted in the past. Were you able to meet any of your resolutions? If not, why do you think you didn’t?
Were any of your goals too ambitious? Or were they too easy? In order to be successful and make the biggest impact, you need to set high, but realistic goals. What is your ultimate, long-term goal for the new year? What short-term goals do you have to meet in order to achieve that?
For example, a common resolution in the new year is to lose weight. You may want to lose 50 pounds this year, but when that is your only goal, you’re likely to find yourself overwhelmed and more likely to fail. But if you vow to lose a less-intimidating 5 pounds a month, you’ll easily meet your 50 pounds in a year goal.
The same goes for your savings goals. Having a major savings goal can be intimidating and stressful, by breaking your resolution down into several small goals, you’re more likely to be successful.
Push yourself and set high savings goals. But also be realistic, otherwise you are more likely to give up when you feel like you aren’t making any progress.
Reevaluate Your Budget
If you want to make big progress with saving your money, you’ll need to take a close look at your current spending.
Tightening your budget is one way to save major money every month. Take a look to see where you can cut back. Can you cut out cable, eat out less, or stop shopping?
Even if you can only free up $100 every month, that will go a long way to help you meet your savings goals.
Find a Place to Store Your Money
Where to store your savings might not seem like a big deal, but it is something to reconsider for numerous reasons.
Firstly, you want your money to be safe. Adding money to your piggy bank or hiding it under your mattress aren’t the most secure options. You’ll want to find an FDIC insured bank or credit union to store your money.
Secondly, you don’t want your savings to be in a place that will make it tempting to spend. If you’re like me, you’ll do better at saving when you don’t see the money very often. Personally, I keep my savings in an online savings account, separate from my usual bank. I can transfer money and do everything like a normal bank, but the fact that it is online makes it seem less tempting to spend.
And lastly, whatever you are saving for, you’ll want to make sure you are getting the best rates possible. You’ll need to research the best retirement accounts for you and find the banks with the highest interest rates for your savings.
Discover Your Motivation
Like with any goal, you will face challenges while saving money. There will be times you want to quit or splurge on something instead of saving.
Prepare for the hard times by acknowledging your motivation. What makes you want to save money? What drives you and keeps you going? Write this down and post it where you can see it.
Have Accountability
When saving gets tough, reminding yourself of your reason may not be enough. You will need to have someone act as an accountability partner to check in with.
This could be anyone you trust – a spouse, parent, sibling, or friend. Tell them your savings goals and ask them to check in with you frequently to hold you accountable.
Make More Money
If you really want to meet your savings goals quickly, you not only need to focus on spending less money, but you can focus on making more money.
We often feel like we have no choice regarding how much we make. Our 9-5 salary seems set and we are too comfortable at the job to make a stink about our pay.
The truth is, there are so many ways you can make more money. You can ask for a raise, work overtime, or find a higher-paying job. If none of those are an option, you can start making money outside of work. You could babysit on the weekends, start your own business, pick up a part-time job, start a blog, or work your way into freelance writing. There is no limit to how much extra money you can make if you’re willing to put in the hard work and time.
Can you imagine if you could make an extra $500 a month? How quickly would you meet your savings goals then? Consider making extra money to expedite your savings resolutions.
Minimize Your Belongings
This might not seem like the obvious way to save more money, but minimizing your belongings can go a long way to save you money.
Think about everything you own. How much of it do you regularly use? And how much money do you put into using or maintaining your stuff?
You can make more money by selling extra items you no longer need. You’ll likely find you enjoy having fewer things and the simpler lifestyle it provides. Committing to a minimalist lifestyle also will prevent you from buying a ton of new things. You will adopt a new habit of really thinking about the worth of things before you make a big purchase. This is a key to long-term financial success!
Saving money should be a goal of yours for the new year, and with some wise planning and serious commitment, you can meet any goal you want. Follow these steps to achieve your savings goals, and see how much your finances will improve by the end of 2017!
