Broke? Can’t Save? Yes You Can! This is How to Save Money

How’s your health? Not your physical fitness but your financial well-being. How much we earn tells us how we’re “feeling” financially for most of us. But your income is only one part of the equation. How much of your income do you actually keep?

Not very much, I’ll bet. Your income is low, you say; you’ve got bills to pay. Rents are sky-high, grocery costs are through the roof—who can possibly save? My answer: You can. Yes, you can.

Come On, Just Do It

Want to save $1,000, $3,000, $5,000 or more? I’ll help you get there. Every day, my mission is to encourage you in myriad ways to spend less save more. I know that you can do this! This is how to save money:

Set a Goal

Saying you want to save a million bucks is admirable, but let’s face it, that is not reasonable. To reach a goal, you need to make it specific, realistic, and measurable, something like, “I’m going to save $500 within the next five months by transferring $25 every Friday to my savings account.” Much better.

Most experts agree you need an emergency stash equal to at least three months’ income—your net take-home pay. Does that seem impossible? For now, why not set your goal as the amount of one paycheck? That’s an amount just about everyone can scrape together with enough determination. When you’ve done that, try for two paychecks, then four. Soon you really will reach that three-months’-worth goal.

 

 

Need Some Motivation?

Get visual and hang up a picture of the item or event you’re saving for. If you’d like to have some money in the bank, make a calendar to post on the fridge and check off all your savings deposits. (You’ll be amazed at how great you’ll feel writing those down.)

Calculate out how much you’ll have in your account a year from now if you don’t miss a deposit. Write it down on a piece of paper (in big numbers!), and tape it in a place where you’ll see it every day.

Jump In

Warning: You might not want to hear this, especially if you’re not a saver. But if you’re going to commit to the program, this is the most important thing to know: Pay yourself first. Before you pay your bills every week, before you buy groceries and gas and clothes for the kids, you’ve got to put something into your savings account. Even if the amount is sometimes less than you were hoping to save, set it aside anyway. As long as you’re headed in the right direction, even the baby steps count.

Watch It Grow

Don’t just stash the cash under your mattress! Open a savings account where it will be safe, and you can watch it grow. But more importantly, where will it be safe from you! And as you add regular deposits, you’ll see it grow.

• MORE: How to Get $1,000 Into Your Emergency Fund—and Where to Hide It

7 Ways to Get Started Today

Sell out

Go through every cupboard, closet, and drawer. If you aren’t using it regularly, get rid of it on eBay or have the mother of all yard sales. A typical sale could raise $500 or more when you start to unload your white elephants. There! You’ve cleaned out the house, and you’ve got a pile of cash to show for it.

Give it up

If you’re going to take this seriously, you’ve got to say goodbye to that little vice (fancy coffee drinks, cigarettes, candy bars, bottled water). It can really add up—saving $5 a day gives you $1,825 a year.

Think twice

I came close to paying full price—$100—for a replacement charger for my phone. But the thought of spending that much money gave me a rash and sent me to eBay. In no time, I bagged a regular charger plus one for the car for less than $10 with shipping. Need something for one-time use? Borrow it from a friend or neighbor (and encourage them to do the same).

Cut the cards

You use plastic to pay for stuff because it’s convenient. So stop using it. It shouldn’t be so convenient to spend your money. Curb all those impulsive purchases. That’s a lot of money you can free up for savings. Cut up all but one good all-purpose credit card. Put it in a safe place to make it less convenient to use.

• MORE: Simple Ways to REALLY Save Money This Year

Bank the raise

Save at least half the next time you get a raise (or bonus). Let’s say that raise improves your monthly take-home by $200. If you save half and do that for the next ten years, that money you didn’t miss (because you never saw it) will grow into $12,000, and that’s not taking into account any interest you might earn along the way.

• MORE: 15 Insanely Simple Ways to Save Money on Groceries

Save the payment

When you pay off something big like a car loan, take the amount you were paying every month and add it to your savings instead. Over five years, a $330 monthly payment to yourself turns into enough to buy your next car for cash.

Do something major

Once you catch the savings bug, do something grand. Get rid of one car if you can. Or move to a cheaper area. 
A big change could send your savings to the moon.

Here’s the Thing

At first, it’s going to feel like a hardship (like dieting, all you can think about is what you can’t have). During my worst years, when I was spending with reckless abandon and racking up debt, I would have told you with all sincerity that we didn’t have enough money to save.

But once I jumped into saving (just a few dollars at first), something amazing happened: I began to feel a new sense of self-worth, dignity, and calm. The more I saved, the better it felt. The better I felt, the more I wanted to do it again and again. And again. This will happen to you, too.

And as you watch your balance grow, prepare for a surprise—saving will become addictive. Try it. Save money. See if how to save money doesn’t become habit-forming.

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