You've been sticking to your budget for a while now. You're easing your debt burden and starting to break even. Or, even better, you're out of the financial woods and starting to see a little extra money at the end of the month. Well Done! This is why you set up a budget in the first place, to break down the cycle of spending and to start saving toward your goals. You can boost your saving potential even more using these time-tested tactics:
1.Put your money toward your savings before anything else; In other words, pay yourself first. This advice, spouted by every financial guru worth his or her weight in above-average market yields, still reigns supreme. Think of your monthly saving commitment as a fixed expense that must come out of your paycheck immediately, just like your rent or mortgage payment.
2. Don't keep increasing your standard of living; Most people live up to their income. That is, their expenses rise to their level of income, no matter how high their income is. A smarter savings strategy: Next time you get a raise or a promotion, pretend that you didn't. Bank those extra bucks instead.
3.Once you have started saving, stick with it; Even when unexpected expenses crop up, don't raid your saving account to pay for them. Figure out another way to pay for those new expenses.
4. Start saving as soon as you can; Here's why: Your money grows through a process called compounding. That is, you earn interest on your original investment and, over time, you even earn inerest on your interest. The key to compounding is time. If you put your money in a secure investment, the longer you let your investment compound, the larger your savings can grow. That's why starting to save early can make a big difference.a
1.Put your money toward your savings before anything else; In other words, pay yourself first. This advice, spouted by every financial guru worth his or her weight in above-average market yields, still reigns supreme. Think of your monthly saving commitment as a fixed expense that must come out of your paycheck immediately, just like your rent or mortgage payment.
2. Don't keep increasing your standard of living; Most people live up to their income. That is, their expenses rise to their level of income, no matter how high their income is. A smarter savings strategy: Next time you get a raise or a promotion, pretend that you didn't. Bank those extra bucks instead.
3.Once you have started saving, stick with it; Even when unexpected expenses crop up, don't raid your saving account to pay for them. Figure out another way to pay for those new expenses.
4. Start saving as soon as you can; Here's why: Your money grows through a process called compounding. That is, you earn interest on your original investment and, over time, you even earn inerest on your interest. The key to compounding is time. If you put your money in a secure investment, the longer you let your investment compound, the larger your savings can grow. That's why starting to save early can make a big difference.a
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