Ask most people about their finances, and they’ll probably say they wish they had more savings. It’s a common goal to have considering 61 percent of Americans wouldn’t be able to cover an emergency costing more than $1,000. Unfortunately, according to the latest Bankrate survey, more than one-third of US households can expect to face such an emergency.
It can be difficult to set aside savings when you aren’t sure where to start, so let this guide help you make the right steps towards better savings. Use these three hacks to help you think differently about your money, so you can put more of it in the bank.
Be specific about your goals
When you promised to “be healthier” for your New Year’s resolution, how long did that last? If you’re like most people, the healthier you lasted about two months before you fell into old habits that may or may not include binge-watching Netflix originals and eating chips for dinner.
While there are many contributing factors to your failure, the type of goal you make doesn’t help. When you promise to “be healthier”, your goal is so vague it can be hard to track your progress. Your final destination is also blurry, as being healthy can mean losing weight or gaining more of it in muscle.
Your goal to “save more” is equally ambiguous and unhelpful. When you want to put more into your savings account, give it a specific reason like paying down student debt, buying a house, or travelling to New York City. These defined goals help motivate you to keep saving. But don’t just put a shiny new label on it — break down your goal into achievable steps. A special timeline and simple tasks make tackling any goal easier.
Rethink credit cards
It’s all too easy to get sucked into using credit cards. They offer more cash than you have on hand at any given moment, and many of them promise cash-back rewards, Aeroplan points, and other bonuses for using them often.
They also promise higher interest rates as well as other penalties should you fail to meet the minimum payments. This is in addition to the latest research revealing credit cards and digital payments make you spend more — up to 18 percent more than you would with cash.
While a credit card can be a useful financial product when you’re making a necessary purchase you wouldn’t otherwise be able to pay with existing cash, they can be dangerous should you rely on them to make daily expenses you can’t afford to pay off immediately.
Be ready for anything
A budget that helps you meet your goal is worthless if it leaves you vulnerable to unexpected bills and repairs. Though you may be focused on funding your summer vacation, your budget should multi-task its savings. Not only will this help you create a nest egg for your future, but it will also help cover emergencies you don’t see coming.
Like, let’s say your cat swallows a rubber band and the vet suggests immediate surgery. A loan is a great alternative to savings in these emergencies, but you may need a specific kind to act quickly.
Luckily, for something as urgent as the health of your pet, you can find fast installment loans online via an online lender. These lenders have automated many of the details regarding your application, so they can offer more responsive assistance during these emergencies. Sometimes you can get the cash you need after just one business day. Lenders like MoneyKey even have an app that you can use to manage your installment loan with a few taps or swipes of your thumb, making it incredibly convenient to apply and repay.
While this guide can help you save for something fun like a summer vacation, don’t forget about it when the seasons change. These tips are a great resource at any time of the year because they make you think about your money carefully. Start by creating specific goals with actionable steps and go from there. When you think logically about your money, you’re more likely to put extra savings in the bank.