When To Accelerate Your Savings
Most people live in a stage of financial flux. Some days we’re earning money other days, we’re spending money. Then there are the times when we go over the edge. Usually, it’s when we need to spend more than we have saved and we need to use credit. Another time we go over the edge is when we work overtime and get that 50% more for working, receive our tax returns, and have more than we usually do. We look for ways to save more, but when would be a good time to accelerate your savings?
You can accelerate your saving most anytime. You can spend less than usual and save more. You can save your raises, tax returns, and other mini windfalls.
When To Accelerate Your Saving
Obviously, there are better times than others to increase your savings. trying to save more after being laid off from work wouldn’t be a good idea.
You could decide to increase your savings at almost any time. It’s just that there are better times than others.
You Notice Waste
One of the easiest ways to find daily waste is to use a spending journal. If you update it daily as you spend money, you will truly know what you spend and on what. It will be easier to find waste if you use a spending journal.
Daily spending: you may have an amount in your budget to spend, but you realize it’s being wasteful. How many cokes do you need a day?
Do you spend money on things that don’t bring value to your life? I would rather be able to travel than drink Starbucks coffee. After all, that’s what frugal living is all about. You need to decide which is more important to you. And pursue it.
These items can be changed daily. At any time, you can change spending to savings.
Change In Plans
I will never forget the day my daughter walked into the house and announced she was getting married. Thank God she was eleven, and I persuaded her not to.
You Spent Down A Category
A basic premise of frugal living is to save for upcoming events and things. Normally these things reoccurring. You save for these items over and over again. How often do you upgrade your phone?
Some are once-in-a-lifetime events like marriage and college education, and you need to save for them. and if you wait too long, you will need to accelerate your savings.
When you have an item that’s repaired or replaced regularly, you routinely save an amount that’s adequate to repair or replace that item in a specific amount of time—items like phones, tires for the car, computers, or routine repairs to your house.
You save for an item when you have enough money to repair or replace it. You spend the amount of money in the category and start saving again.
Upcoming Events
Life changes at an impractical speed. For now, things we never thought of or had time for or upcoming things, and we need to adjust our savings accordingly. We need to accelerate our savings.
It could be a wedding, a child’s college, a car, or a vacation. Saving small amounts of money here and there can be very useful in increasing our savings.
When You Are Making More Money
Most people have an influx of money throughout their lifetime. Usually, overtime raises tax returns. And other small windfalls, this is an ideal time to accelerate your savings. This is an ideal time to save more to catch up and maybe overfund some most used categories.
Find Ways To Save More Money
Never before has it been easier to make money in America. A large group of people earn a living doing odd jobs. Technically they don’t have a job, but they work and earn a living.
You can work from home, or you can have an office job. you can have a series of side hustles. There’s plenty of money to be made.
Automatic Deposits
Save money thoughtlessly and effortlessly using automatic deposits. Most banks have a way for you to deposit money into savings and retirement accounts automatically. Set it and forget it.
Do A Financial Fast
A kin to the “no spend day.” For a predetermined amount of time, decide to spend no money that isn’t necessary. Items like cokes, Starbucks, treats, and much more.
I know you can cheat this system easily. But if you want to accelerate your savings, you need to make changes somewhere. And taking a few days a month to live miserly is a good place to find money to funnel into your savings.
Save Your Raise
Save your raises. There is no reason to spend it. You have lived this long without it, so save it. There’s a thing called lifestyle inflation, all it is is adjusting your living to the amount of money you earn. The more you earn, the more you spend, usually buying nicer toys. Don’t fall victim to lifestyle inflation. Save as much as you can so you have the money to spend on things that are important to you.
Save the majority of your raise or, better yet, all of your raise.
Lower Your Fixed Expenses
There are several ways to lower your fixed living expenses. You could ditch the car payments, get a roommate, lower your electric bill, or move to a cheaper place.
Get Out Of Debt
If I’ve said it once, I have said it a million times. Debt doesn’t add value to your life. The interest you pay could have gone to short or long-term goals.
Conclusion
Knowing when to accelerate your saving is instrumental to building wealth. You must plan to save the money you normally spend on things that aren’t important to you. And knowing when to increase your savings is important. Increase your savings thru normal budget monitoring or when you receive a raise or small windfall.