Ways to Create Extra Money for Savings

Without an emergency fund, there is no money to cover unexpected expenses like car repairs or medical bills. However, by taking a look at your current spending habits and setting a saving goal, building a nest egg is a real possibility. Here are some ideas to help free up your money for savings.

Focus on Needs

Consider needs versus wants. Think about the items you purchase on a regular basis. These add up. Where can you save?

  • Do you eat at restaurants a lot?
  • Can you cut back on daily expenses (ex: coffee, candy, soda, or cigarettes)?
  • Do you have services you do not really need (ex: cable television or a high cost phone plan)?

Be Timely

Pay your bills on time. This saves the added expense of:

  • Late fees
  • Extra finance charges
  • Disconnection fees for utilities
  • Fees to reestablish connection if your service is disconnected
  • The cost of eviction
  • Repossession

Open an Account

Consider opening a checking account at a bank instead of using check-cashing stores.

  • If you use check-cashing stores, you might pay 2 percent or more of each check you cash. Two percent of a $500.00 check is $10.00. This can easily add up to several hundred dollars in fees every year.
  • Opening a savings account and setting up recurring transfer from your checking account to your savings account can help you build a nest egg. Just be disciplined to not touch the money in your savings account. If you save just $10.00 a week, you’ll have $520.00 saved in twelve months, and $2,600.00 saved in 5 years.

Most financial advisors recommend building an emergency savings fund of at least 3 to 6 months of your regular expenses. Big goals can take time to accomplish, so we recommend having patience and taking it one step at a time.

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