If you’re reading this, you’re probably a self-proclaimed “broke college student.” I’ve found that many people my age are not educated on basic personal finance topics. Perhaps this is a larger problem in regards to education, but I’m here to give you some tips on saving money, one of the first steps to achieving what you want to gain with your money.
Most people find it very easy to spend money, but much harder to save it. We are continually bombarded with advertisements vying for our dollar, but if we have larger goals to obtain, we should prioritize those. Some people even shop just out of habit or out of boredom. We must take a new approach on how to spend and save money.
Think about saving money like investing in your future self. Your future self will thank your present self later when you find yourself in a situation in which you really need that little extra cash you saved. Here are eight tips to help you get started:
- Track your spending in a budget for a month. This will help you determine where you stand and help you determine what goals you should set for yourself. Tracking your spending helps you figure out what places you tend to spend the most money. Knowing this information, you can set a limit for next month to limit your spending in that category. A budget is also vital to know where your money is going and how much you have.
- Have a specific goal in mind. Having a specific goal makes saving much easier. It doesn’t have to be large, something as small as $100 will do. You can have a goal to save to study abroad or to travel somewhere for spring break. Making a visual tracker to track your progress along the way can also be helpful to see how far you have come. Goals give you the incentive to save because you will have something to reward yourself with when your goal is reached.
- Dedicate one savings account for just saving and don’t touch it. Some banks also allow you to rename your accounts to specific things such as “Spring Break Fun.” This plays a psychological trick on your brain so you know the money in that account is for that goal and will make you feel guilty if you take money out of that account.
- Make a habit out of it. You can try to save $20 out of every paycheck. If you receive your money from work through direct deposit, you can set up automated transfers to automatically move money from your checking account to your savings account without having to think about it. This also prevents you from seeing a large sum of money that you may feel inclined to spend. Keep in mind the date you are paid and approximately how much you are paid to figure out when to initiate these transfers and how much. You can use strategies such as these to help you make saving a habit.
- Try not to buy something just because it is on sale. Take a moment to pause and decide if you really need that item. If it is something you need that happens to be on sale, go ahead and buy it. If not, it can probably wait.
- Unsubscribe from promotional emails and unfollow brands on Instagram. This will make you less likely to see deals and thus less likely to spend money. It also cleans up your email inbox and Instagram feed to see things that are most important to you.
- Make a list of the things you want to buy. This will force you to look at all the things you want and decide if you really need those items or if you can hold off on buying them or if you can find something similar for a cheaper price.
Saving is an important step in reaching financial freedom and gaining control of your finances. Your money is a tool and it should be working just as hard for you as you work to earn it.