With the holidays quickly approaching we all have spending on our minds. Then when January rolls around, we calculate the aftermath of our spending habits and create New Year’s Resolutions to get out of debt and build an emergency fund.
But I have a better solution! Let’s not fall into this same habit this year. The holidays shouldn’t be an excuse to stop saving and go into debt. In fact, you can have a much more peaceful and relaxing holiday if you aren’t stressing about money.
Today I want to encourage you to make saving a priority and put money away in an emergency fund if you haven’t already done so. Here are two powerfully effective tips you can use to jumpstart your savings habit.
1. Start Small and Stay Consistent
When I got my first “real job” I remember my Grandma telling me to put $20 from each paycheck into savings. To me that $20 was a big deal! “There’s no way I’m going to let my hard earned money sit in a bank account.” I thought. But if only I would have listened to her advice.
The thing is, those small amounts add up fast. Yes, $20 a week was big deal to me at the time but it still wasn’t a large amount of money in the grand scheme of things. Saving $20 a week for 12 months would have equaled $1,040 at the end of the year, which is a fantastic way start to an emergency fund and build a savings habit.
If you were like I was, thinking that there’s no way you can part with $20 a week then start with $5. At this point putting something toward your emergency fund is better than nothing and your consistency will create a habit that sticks with you forever.
2. Earn Goal-Specific Income
Do you know how I’ve saved for most of my financial goals? I have multiple streams of income and each is earmarked for a particular goal. Some bloggers even call this a “Gigs for Goals” method because you’re earning money from a specific job or task that will be going straight towards your goal.
It’s an amazingly effective strategy. Here’s a quick example:
For instance, now that I’m self-employed all of my freelance money covers my regular bills and cost of living. I also earn a little bit of money from my own blog which goes straight into my investment property savings account. Occasionally, I’ll do other jobs like helping my Dad at his store and that income goes into a specific savings account as well.
You can do the same for your specific goals, like paying off Credit Card X or saving money towards your Travel fund.
I’m not suggesting you get a second job, or work yourself to death, just be a little more creative. Can you sell some stuff online? Or put all cash gifts (aka found money) you receive in an emergency fund? Or start using coupons and then put your daily savings into an actual account?
Be creative and earmark certain income sources to go directly towards specific goals.
How Else Can You Create a Savings Habit?
If you’re looking for ways to jumpstart a savings habit, build up an emergency fund, or pay off credit cards, you probably already know the basic tips for budgeting, cutting costs, and earning more money. (If not, look around the site and start reading!)
So why not try these two unconventional tips and get a jumpstart on your New Year’s resolutions? There are hundreds of things you can do to make your savings grow at a faster pace.
But at the end of the day your success depends on how hard you work and what kind of sacrifices you’re willing to make. Don’t wait until next week or next year, start building a savings habit today!
What’s another powerful tip to build a savings habit? How do you prioritize your goals each year?
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