By Ashley Chorpenning
If you struggle to save, you’re not alone. In fact, close to 40% of Americans save less than 5% of their annual salary each year. If you want to boost your savings, changing your financial habits is one of the best ways to become a real money saver.
1. Create a budget
To improve your financial health, it’s important to review the money you have coming in and going out. A budget helps you monitor your spending habits and tells you where money should go. A good rule of thumb is to use the 50/30/20 rule by spending 50% of your income on necessities, 30% on luxuries, and 20% on savings.
2. Set savings goals
Goals give you direction and keep you disciplined. Establishing savings goals can help you stay motivated and consistent when contributing to your savings account. Writing down your goals is the first step to creating a financial plan.
3. Automate your savings
Eliminate the temptation to skip a contribution or use your savings for other purposes by automating your savings. Visit your bank or financial institution to set up a regular automatic bank transfer from your checking to your savings account.
4. Review and adjust your budget
Reviewing your budget will help you ensure you’re on course to achieving your savings goals. Plan to review your budget regularly, say, every six months.
5. Find deals and discounts
A true money saver does not want to part with their money. Always look for deals and discounts, which will help you keep more of your money. When making big or small purchases, compare prices and don’t be afraid to negotiate.
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