Quick Tips for Saving Money
This is a quick read, but a good one. I love money. i love spending money, and I love saving money. Here are a few tips to help you manage your funds a bit better:
1. Siphon from Yourself
Sneak money out of your paychecks by setting up an automated savings account that builds monthly or biweekly. At 5 percent interest, an extra $100 a month will net you $16,000 in 10 years.
2. Fork it Over for Your 401(k)
If you’re younger than 50, max out your 401(k) contributions, especially if you receive an employer match. Why would you turn down a 6 percent raise? Also, at least 70 percent of your portfolio should be invested in stock funds. You’re young—you can afford to ride the market’s waves.
3. Document What You Spend
According to Visa, men lose track of $3,078 every year, on average. Wrangle those sneaky greenbacks by saving every cash receipt, including ATM withdrawals, for 30 days. At month’s end, tally up the damages and surprise yourself by breaking a pricey habit or two.
4. Get the Red Out
The objectives here are to tackle debt, avoid paying fees, and lower your interest rates. First, arrange an automated monthly payment system to cover all of your minimum debt payments. Next, throw all of your financial power (and some of that mystery cash) at the debt with the highest interest rate. Repeat as necessary until the debt is completely gone.
5. Set Go-o-o-oals
Whether the goal is small (an annual vacation) or large (retire by age 60), crunch the numbers to understand what it will take. Need help? Sit down with a financial planner (find one at fpanet.org) for as little as $80.
6. Update Taxes
If you married, had a baby, or received an inheritance during the past year, it’s time to reevaluate your tax situation. Hand over the shoebox when things get complicated; a great tax professional can save you thousands every year. Find one at aicpa.org.