Tuesday, November 17, 2015

Tips for socking away $1,000

Saving up a thousand dollars is one of those things that to many Americans, seems like a pie-in-the-sky ideal that’s just too good to be true. It seems like an impossible mission, given the extent of debt that many of us are dealing with on a daily basis. The thing is, just about every personal financial advisor you talk to suggests that before you focus on getting debt paid off, you should lay aside at least $1,000 to use as an emergency fund. So, how do you do it? With all the other bills to deal with, how is that possible? Actually, you might be surprised how you can make it happen. It isn’t easy, but at the same time, it isn’t impossible, either. Here are a few tips you can put to use to lay aside that $1,000 before spring!

Grocery stores suck down a remarkable amount of disposable income, and I’m sure you are well aware of the impact of your food bill every month on your ability to save. At the same time, this is one of the more difficult ways to trim your budget, because it has more to do with habit than with actual need. That means it is by turns more difficult to deal with, and the most substantive way to make cuts. First off, make a budget for the next few months by looking at your current grocery bill and cutting away all the unnecessary things that you THINK you need, or that you consider your “right” “privilege” or something you have “earned.” While it’s true that you probably have, these are little more than behaviors that enable your poor spending habits in the grocery store. As such, avoid deli meats, expensive cuts of meat, ice cream, candy, soda, snacks, and health foods. Stick to standard fruits, vegetables, and common cuts of meat, and you’ll be surprised by how much cash you’ll save over the course of a few months. It could be on the order of hundreds of dollars per month.

Gas expense is one of those things that many consumers take to be a fixed expense, but in reality it varies tremendously from month to month. Sure, there’s the typical back-and-forth to work driving you have to do, but in order to trim your gas expense, you really have to carefully account for where you’re going, why, and how you can combine trips. Are you driving thirty miles to walk around a mall for no particular reason? That would be a signifiant waste of fuel- typically about four gallons’ worth, depending on your fuel economy, which can cost between $8 and $12 depending on your current prices locally. Do that a couple of times per month, and you’re looking at a savings of around $50 per month or so. 

Avoiding restaurants at all costs is one of the best ways to save up that $1,000, particularly if you tend to frequent restaurants more than once per week. Usually, what you would spend at a restaurant could equate to four or more meals at home, so cutting out the restaurants, along with trimming the grocery budget, is a great way to go. Doing this will give your finances a new lease on life, and are likely to help bring you back from the brink, as so many people are today.

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