We often start the new year with grand plans. And if you’re like most of us, those plans include improving your finances.
In The Penny Hoarder Community, many members responded in a survey about their goals for the new year that they want to save more money in 2020.
We’re hoping this is one resolution everybody sticks to. Here are some money-saving tips that will aid in your success.
1. Have a Plan for Your Savings
Having a compelling reason for not spending all your paycheck will help you stay motivated when you just want to treat yourself.
Maybe you need an emergency fund so you won’t fall further into debt the next time your car needs a repair. Perhaps you want to save up so you can finally afford a nice vacation.
Keep your reason at the forefront of your mind so you remember why you’re saving. You can even nickname your savings account to reflect your reason.
2. Make Your Goals SMART
It’s good to simply save money, but you’ll likely have better success with a goal that’s “SMART” — specific, measurable, attainable, realistic and timely.
How much money would you like to save? By when? How much would you need to put aside each payday? Can you afford that much and still pay your necessary expenses?
Adding details to your goal makes all the difference.
3. Embrace Automation
Saving money won’t feel like work when you set it and forget it.
Pay yourself first by adjusting your direct deposit so a portion of your paycheck automatically goes into savings. You won’t miss what you don’t see.
Alternatively, you can set up automatic transfers from your checking account to your savings account after payday.
4. Let an App Save For You
Need help saving money? There’s an app for that.
Here at The Penny Hoarder, we’re fans of using technology to our advantage to help us save. Check out our seven favorite money-saving apps. These tools help you squirrel away extra money and make the most of it, even if you aren’t starting with a lot.
5. Participate in a Savings Challenge
Saving money can seem dull — but not if you frame it as a challenge.
Start the new year with a fun way to stack cash. These five money-saving challenges will keep you on your toes and test your limits — and if you do it right, you’ll end up with sweet returns.
6. Find Less-Costly Alternatives for Everything
Reduce your expenses by choosing cheaper alternatives for the stuff you buy all the time.
Visit the thrift store instead of the mall. Try the farmer’s market rather than Whole Foods. Buy generic over name brand items.
Pocket the difference and funnel it to your savings.
7. Reduce Recurring Expenses
You’ve got bills to pay every month — plus groceries, gas and all those other necessary expenses that aren’t going away. However, if you shave a couple hundred off those monthly costs, that’s money that can go toward savings.
Call your cable, internet and cell service providers to negotiate a lower rate, or downgrade to a cheaper plan. Reduce your housing costs by renting out a room on Airbnb, getting a roommate or even considering a coliving arrangement.
Check past bank statements to figure out which monthly charges you could get rid of altogether — like that gym membership you never use.
8. Go on a Cash-Only Diet
When you use debit or credit cards, it’s easy to swipe yourself over budget. Buh bye, savings.
When you use cash, however, you have a finite amount of money. If you only have a $20 bill with you when go out to lunch, you can’t choose something that’ll come to $24.95.
Switching to the cash envelope system can help you stick to your spending plan, which means you won’t cut into your savings.
9. Make Extra Money
Increase your cash flow to have more money available to save.
Ask your manager if you could pick up extra shifts or see if you can negotiate a raise. Get a side gig or a second job where you can work from home. Or get a one-time cash influx by donating plasma or selling clothes online. It all adds up.
10. Add a Layer of Accountability
Like a gym buddy can help you stick to your fitness routine, having a money buddy can help you reach financial goals, such as saving money.
Check in with your financial accountability partner when you need the moral support to walk away from a pair of new shoes at the store. Celebrate your successes with your buddy when you reach benchmarks in your savings plan.
Another way to keep yourself accountable to your savings goal is by regularly tracking your spending, making you more conscious of what you buy. When you get in the practice of writing down what you spend every day — and confronting it in black and white — you may be less inclined to spend money recklessly.
Nicole Dow is a senior writer at The Penny Hoarder.