Uncover hidden leaks by taking a closer look at where exactly your dollars are going. Here are some painless ways to spend less so you can save more.
Like going to the gym or eating a healthy diet, saving money is a simple concept to grasp but challenging to practice.
We understand its benefits. We agree that it’s essential to our well-being. And we know that it’s something we should be doing.
But paycheck after paycheck, it’s the same routine: After the bills have been paid and the regular expenses have been looked after, there isn’t quite enough left over for our savings goals.
We blame our lack of financial willpower and promise ourselves we’ll do better next paycheck. But the cycle usually repeats itself.
If this scenario seems all too familiar, consider automating your finances to pay yourself first.
How to save more money by paying yourself first
Paying yourself first is an effective savings strategy because it takes willpower right out of the equation.
Rather than struggling to increase your self-control, you reduce your need to put it in action.
When you get paid, a portion of your income immediately funnels into your savings.
The size of that portion is up to you. To figure it out, take your total monthly income, subtract your essential monthly expenses and then decide how much of the remainder you want going toward your savings goals.
That portion might be small at first. But it will add up over time and get you in the habit of saving consistently.
As your savings grow and you make progress on your financial goals, you’ll see your monthly cash flow in a new light. You’ll start figuring out how to save more money by reprioritizing your budget.
Automate your savings plan
You can further reduce your reliance on willpower by automating your savings plan. By setting up a strategic system of automatic deposits and transfers, you’ll save money without thinking about it!
Consider incorporating one or more of the following tips into your automatic savings plan:
Know how your account works
Automation is an incredibly powerful tool when it comes to saving money—but not if it ends up costing you money!
Some bank account types might limit the number of free transfers (between your accounts) or free checking transactions (online bill pay) available to you in a month.
This is something to consider when designing your automated savings plan. If you’re unsure of your account’s limits, talk to your financial institution and find out. You might even learn that it offers account types better suited to your savings plan.
Automate your paycheck
Your employer can help you reach your savings goals before your paycheck even hits your bank account.
Take advantage of any retirement savings plans offered through your employer—especially if they include an employer match.
If you get paid by direct deposit, ask your employer if they accept multiple deposit accounts. If so, have a portion of your paycheck deposited directly into your savings account each payday.
Automate your checking account
If your employer doesn’t have the ability to deposit some of your paycheck into your savings account, do the next best thing: Set up an automatic repeating transfer from your checking account to your savings account.
Schedule the transfer for shortly after payday. That way, as you budget out your month, your savings will already be safely tucked away out of sight, out of mind.
And if your employer doesn’t offer a retirement savings plan—or you’re not quite ready to start one—you can consider opening a Launchpad savings account.
The Dupaco account helps you prepare to open an Individual Retirement Account by allowing you to save at your pace. Once you’ve saved $1,000, you can move your savings into an IRA.
Automate your savings goals
Admittedly, throwing money into a generic savings account every month isn’t a particularly imaginative experience. It’s not representative of the future happiness you’re creating with your savings goals.
Increase your motivation and excitement around saving money by reminding yourself of the specifics of your goals.
If you have the ability, create additional savings accounts or subaccounts for each of your goals and give them custom titles. With Dupaco’s You-Name-It Savings accounts, you can open as many as you want.
Watching the numbers grow beside “Surfing in Costa Rica” or “Dream house with patio and fire pit” is more inspiring than simply “Saving.” Get even more granular by setting up regular automatic transfers into each of your subaccounts.
And with Dupaco’s Savings Goal, you can get help creating a customized plan to reach your goals. You can access this tool in Shine Online or Mobile Banking.
Automate your bills
Your savings won’t accumulate if late fees and missed payments keep eating into your budget. Set up automatic bill pay for your recurring expenses.
Organize and streamline the process further by calling companies to adjust your billing dates. Grouping billing dates together can make them easier to track and manage.
Bonus tip: Look for extra opportunities to save
Once your automatic savings plan is in place, look for little ways to make additional contributions to your savings accounts.
Empty the contents of your spare change jar once or twice a year and deposit it into your savings. And save your “loose change” from debited transactions through Dupaco’s ChangeUp Savings. ChangeUp automatically rounds your debit card purchases up to the next dollar and deposits the difference into your savings account.
If you participate in a cashback rewards program, consider putting that “extra” money toward your savings instead of spending it. Also consider putting any future income tax refunds toward your savings.
You can get creative in finding additional sources of income to help your savings along.