As costs of living continue to rise and retirement savings options such as Social Security reserves continue to decline, many Americans are looking for ways to build their savings in order to live a more financially secure life – and one that allows them to look forward to retiring.
We’ve put together the ultimate guide to building your savings so that you can move towards a life of financial freedom. In order to set yourself up for success, you’ll want to start following these rules:
1. Create Long and Short Term Savings Goals
The MOST important step in building your savings involves creating goals. But you won’t get anywhere with just generalized goals like I want to have more money to spend how I want at the end of every month. You need to get descriptive and set both long and short term savings goals.
Short term savings goals
These will allow you to save for vacation, gifts for birthdays or holidays and bigger purchases like cars.Think of short term savings goals as anything you’re looking to save for in the next five years.
Long term savings goals
Look at your long term savings goals as things like paying off your mortgage, saving for a college fund or putting together a nest egg for retirement.
For each goal, list out how much you need overall to achieve it, what your time frame is to save, and then calculate how much you would need to put back monthly to achieve your goals. SMART goals can set you up for success in building your savings.
2. Develop a Budget – and Stick to It!
Money goes out almost faster than it comes in. And when you aren’t monitoring all the different places you’re using it, your funds can disappear before you even know what happened. If you’re looking for a way to develop a budget that actually works, check out our 5 easy steps to create a budget.
3. Monitor Your Credit Score
Part of building your savings involves knowing where you stand with your monthly bills – and how they relate to your credit score – including what ways you can improve it and reduce your monthly outgoing.
By monitoring your credit score and using free platforms like Credit Sesame, you’ll be able to know at-a-glance where you stand and how you can position yourself better for opening up more opportunities to save. Looking to make your credit score better?
4. Get Yourself a Side Hustle
Sometimes, no matter how you build your budget or plan for savings goals, there’s just not enough coming in monthly to get you where you want to be. In those cases, finding a good side hustle is a great way to bring in some extra cash to put towards building your savings.
Are you crafty? Perhaps you could make things to sell on Etsy. Looking for something to do from home? Find freelance gigs on places like Fiverr or Upwork. Have a lot of extra stuff around the house you don’t use? Put together a garage sale or place your items for sale online through a buy/sell/trade page for some quick cash and instant decluttering.
When you’re looking for ways to quickly and easily manage your money, South Suburban Currency Exchanges is here to help. Call or stop by today!