How to Save Money on a Budget
I've never been by any means a rich kid. My parents have always been 'middle class' by the book and I was cut off of any parental income at the age of 16 (when I got my first job).
It's been 8 years since then and although I still frequently struggle with saving money (but really, how can you not when you live in San Diego and there's more activities to take on in a day than a lot of people see in a year) I've been getting much better at managing my income.
In this particular post, I want to share with you all how I save for traveling, clothing and just general savings.
First and foremost: you always want in your savings account TRIPLE of what you make in a month. For me (just counting my job as a waitress) I should have $5,000 in my savings account at all times incase shit hits the fan and I lose my job or need to take time off work for an emergency or WHO KNOWS?! It's MUCH better to be safe than sorry.
My favorite and easiest way of saving is the old fashioned way, a piggy bank (or in my case, mason jar bank). Being a server in a high end bar, I'm constantly given change at the end of the night. EVERY penny of that is put into my mason jar. Aside from change, I also like to throw in at least one dollar every single day. You don't get cash because you have direct deposit? NO WORRIES! Pull $40 from your account at the beginning of each month and each day, drop $! into your jar. I say only do $1 per day because you don't want to put in too much and have to pull out of your jar. Your jar should be labeled with what it's for and not TOUCHED until it's full and you're ready to use those savings for the particular event or item you've been saving for. It's also helpful to write your goal down on the jar so when you deposit the coins and cash, if you aren't at your goal, you can out that cash into the bottom of your jar and keep it going. Chump change is definitely my favorite way of saving because you never notice it being gone and you never realize how much change can add up until you start utilizing it! I typically have two mason jars in action and I add to both as frequently as possible.
Next up! Have a sep. savings account in your bank that you don't touch until you've reached your goal for it. My additional savings account is call "travel" (go figure). Simple right? Your accountant can easily open a new savings account for you that's linked to all of your others so after each paycheck, you can easily hit "transfer money" on your bank or credit union app and oua la, you've got another saving method in action. The tricky part with this one is how easy it is to transfer money over apps. Just because you make more money one month than others, still only put it a reasonable amount (maybe no more than $100 per month) because you want this to be a SAVINGS account, not a backup checking to pull from.
Here's easily the hardest way to save... stop using your credit card! I got my first credit card just three month ago and HOLY F I never realized how easy it was to spend money I don't actually have. I have $800 right now to pay off on my credit card... needless too say, they are a bad idea. ONLY spend what you KNOW you can pay back at the end of the month. My mistake is trying to use it everywhere I go BUT I only get cash back on groceries and gas so in reality, I shouldn't even be LOOKING at my credit card unless it's at a gas pump or Trader Joe's. It's important to build up your credit but it's even more important not to fall behind on payments. ONLY SPEND WHAT YOU HAVE.
Make your meals, stop eating out! I try preaching this as much as I can and my boyfriend STILL doesn't quite get it but I'll try my best to make this one stick with you. The reason James doesn't find this and an efficient way to save is because when we make a grocery run, we typically spend $50-$100 every week. Not only is buying an making your own meals from a grocery store vs. restaurants going to provide you with more options, it's going to save you from tipping, over ordering and eating god-knows what at restaurants. Being a server, I can't help but tip 20% (which is what I hope you are all tipping your servers when you go out!)(18% being minimum for average service and 20% being you had great service) (if you ever go into a restaurant expecting to tip less than 18%, you shouldn't be eating out in the first place.) Anyways! That's a blog post for another day. I can do a whole breakdown on my grocery shopping in another blog post as well if anyone is interested in seeing how I make a dozen meals after just one trip to the grocery store. Let me know if you'd like to read about it!
Lastly, budgeting. There's a lot to this so I'm just going to sum it up by saying GET A BUDGET BOOK! Unless you have an accountant doing all of the work for you (which I assume you don't if you're reading this post) get a budget book and for a whole month, write down EVERY expense. (When you don't have your book handy, write down what you bought and the price in your phone notes and later update your book). At the end of that month, really break down what you can cut back on. If you're spending $60+ on coffee each month (trust me, I know how easy it is to do) invest in a Keurig or French press! (The one's I've linked are within your budget!) Once you've done your first month of budgeting, KEEP IT GOING. Continue to write down EVERY purchase. Since you were able to see what you spent the month before, your next month should have a LIMIT. DO NOT EXCEED YOUR LIMITS. STICK TO YOUR GUNS! It's hard as hell, I know it, but trustttttt me you'll be so satisfied with yourself when you see how much you're able to save when you monitor what you're spending your money on. When you go out to lunch with a friend or maybe a night out on the town, pull out CASH and ONLY use the amount you pulled out: pretend that's the only money available to you.
I'll be putting together for you all a more detailed budgeting blog post but until then, I hope you find this information useful, I know I do! Comments, questions, advice in the section below!
Happy savings, peeps!