How to Save Your Money

Tips for How to Save Your Money

Saving money isn’t easy, but the results are well worth the extra effort. If you remember a few basic tips while you’re in your 20s, your financial goals will be well within your reach during your 30s and 40s.

Get Organized

Even if you don’t have three kids and a mortgage to worry about, the key to taking control of your money is organization. Create a simple budget so you know where your money needs to go each month. If you’re prone to procrastination, it’s also a good idea to post a calendar in a prominent spot so you remember to pay your bills on time and avoid expensive late fees.

Live One Pay Raise Behind

One of the best ways to learn how to save your money when you’re just starting out is to get in the habit of living one pay raise behind. For example, if you get a promotion at work that adds an extra $50 per week to your paycheck, arrange to have that money automatically deposited into your savings account. Since you’re used to living on less, you won’t miss the money and you’ll have saved $2,600 at the end of the year. Then, when you get your next raise, raise your paycheck by $50 per week instead of the current raise amount.

Dress for Less

If you’re making the transition from college student to working professional, the prospect of building an office-ready wardrobe can be overwhelming. Fortunately, there are many bargains to be found in outlet malls, thrift stores, and consignment shops. You may even be able to find what you need on eBay. To learn more about looking your best while on a tight budget, pick up a copy of Kathryn Finney’s How to Be a Budget Fashionista.

Pay Attention to Details

Even if you’re generally quite responsible with your money, you may still be making a few financial blunders that sabotage your savings efforts. For example:

• Think before you drink. Alcohol is a huge part of the social scene for many young people, but it’s also quite expensive. Volunteer to be the designated driver for your friends occasionally and you’ll save a bundle. In fact, many clubs offer free soda or coffee to a guest who is acting as a group’s designated driver.
• Learn how to cook. If you’re used to eating in a college dormitory every night, it can be difficult to take responsibility for preparing your own meals. However, eating at fast food restaurants or stocking your freezer with nothing but microwave dinners can get quite expensive. Learn how to make a few simple meals and you’ll see a huge drop in your grocery bill. If you live alone and you’re worried about leftovers, invest in a cookbook of recipes that serve just one person.
• Understand your cell phone plan. Your cell phone may be a vital part of your daily life, but you can do some serious damage to your finances if you go over your monthly minutes, send too many text messages, or incur excessive roaming charges. Make sure you know what services are included in your plan and what will cost extra.

Additional Information

For more money management advice for young adults, check out the following helpful links:

• Top 10 Tips for Your 20s
• Retirement Planning for 20-somethings
• How to Get Credit if You’re 20-something