Did you know that saving money can bring you more freedom, flexibility and security ? If
so, why don't you do it ? Is it because you don't have the right strategies or you just
don't know where to start? Saving money allows you to do many things in life, but most importantly,
it reduces financial pressure. Everyone knows that oppressive feeling when you look at your
bank account and know that it could get really tight if an unexpected expense comes up right
now. Can you think of a few instances right now where you should have saved up for money
instead ? If so, I can reassure you, you won't be the only one.
About 25% of American families have not saved and about 40% of workers in America are not
saving for their future. Most of the rich have become rich by saving a little bit over
a long period of time. And the principle is so simple: spend less than you earn. Save
and invest what is left over. But why do most people have such problems with saving money?
There are several reasons for this: bad habits, lack of prioritization or simply lack of financial
education. And that's why today I'm going to show you
5 ways to increase your savings to put an end to the financial pressure once and for
all or to reach your financial goals faster. But before we dive into the topic : Hello
and welcome back to our channel ! And if you are new here : We are the finance nerds and
on this channel we are helping hardworking people like you to get more out of your hard
earned money by showing you how to use your money in the most effective way. Remember
to give this video a thumbs up at the end, if you got value out of it and now you will
get 5 ways to increase your savings easily !
Automate Your Savings and Pay yourself first Probably you have often heard these tips that
you should pay yourself first. The advantage is that before you spend any money on anything
else, you pay yourself in the form of savings and investments that will put you in a better
position for the future. Many people find it difficult to budget their money for themselves
first, so it makes sense to automate this process by simply creating a separate savings
account and a separate investment account and putting a fixed monthly amount into each.
This way you make the whole process much easier for yourself, as you don't have to think about
it.
combine your debt and save on interest If you have many loans with different banks,
the probability is high that you do not have the best conditions across the board and therefore
have to pay very high interest rates. What if there is a way to lower these interest
rates and save money? This process is called refinancing, where you convert all your loans
into a consolidation loan. This way you have only one loan, which makes it easier to manage
and you save money at the same time because of lower interest rates. Now, if you want
to pay off your loan even faster, you use the money you save to pay off the loan faster.
Set Saving Goals What's the point of all this saving money
and investing money if you don't know what you're doing it for ? What do you think will
happen in the long run if you don't have a goal for your money ? Exactly, you lose focus
and end up spending the money on things you don't need. Of course, such goals are very
individual, such as one saves money to go into retirement earlier and the other saves
money to buy a house later. However, there are 3 really important goals that you should
consider: what you want to do with your saved money.
These 4 big goals would be ... 1. save money for retirement
2. save an emergency fund 3. save for big purchases
Reduce recurring expenses The recurring fixed costs are the ones that
reduce your income every month. Take a look at your bank statement and look at all the
things you spent money on last year and then ask yourself if you still use those things
or if you can find a cheaper alternative. A few things I've already touched on such
as Refinancing your debt. But there are other things, like small subscriptions to magazines
or entertainment. If you look at it with an open eye you will surely realize that you
pay for many things every month without really using them. This tip alone can save you thousands
of dollars!
Use the 24 Rule Your behavior decides what your life looks
like. In the same way, it decides how your financial situation is. We all have good and
bad habits, and it doesn't stop with money. Who doesn't know the situation of having bought
something and later realizing that you didn't need it or simply didn't use it at all? With
this rule you forbid yourself to buy anything over a certain amount until you have waited
24 hours. As an example, you could set that for every purchase over 100$ you wait 24 hours.
You will find that waiting often makes you want to not make that purchase. You reduce
by this rule your impulse purchases that we humans have quite often ! Use this rule and
save a lot of money in the long run and more importantly: change your spending behavior!
If you enjoyed the video and now want to know more about how to take control of your finances,
click on the video to the right or check out the video description. There you will find
more videos and resources to help you have more money at the end of the month.
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We hope to see you in the next video.