You Can Save Money Even When Times are Tough

Increasing your savings is often the last thing you’re thinking about when times get rough. It can seem like the only advice you’ll ever see are from people explaining how you should be putting money into your savings account at the end of every month. Unfortunately, many people simply aren’t able to follow this advice.

Let’s look at the facts:

-The median income in 2007 for households was just a bit more than $50,000.

-A whopping 37.3 million people live in poverty, with a median income definite of $8,523. The income deficit indicates how far a family’s income is below poverty level.

-Nearly 46% of Americans live without health insurance.

That lets us know that an overwhelming number of American families are unable to save money simply because they don’t have the money to save. You may fall into one or more of those categories. Perhaps you’d like to save money and aren’t able to simply because you don’t have the money to do it. Though it may seem impossible, there are some ways you can save money.

Remember the childhood story The Little Engine That Could? In the story, there was a little blue engine that was charged with the great task of pulling a heavy train over a mountain. The little struggled and strained, but ultimately made it over the mountain by repeatedly saying, “I think I can.”

As children we were told (or, in my case, read to ourselves) about the little engine that could. The parable story was of a small train that was told to accomplish the great task of carrying a train full of toys and fool across the mountain range. It was tedious work, and several times the small engine came to a standstill, unable to budge. But then each time he simply told himself “I think I can, I think I can” — and so he did.

Think your chances of saving are good? If you answered that question with a no, then your chances of saving aren’t good — it’s a self-fulfilling prophecy. Whether you think you can or you think you can’t, you’re right. Want to increase your chances of saving? Start by telling yourself that you can.

Want to save hundreds or thousands? Start by tracking your spending. Unless you are incredibly disciplined in your spending habits, then there’s almost always a loose end somewhere. What might feel like an occasional expense or a necessary evil can often actually be a well-disguised frivolous expense.

Just take all of your expenses and write them down for a month. Everything from your bills, to meals, to movies, to, well, everything. Ask for and keep your receipts and withdrawal tickets. Save all bank statements and credit card statements. Save everything.

When you look at your budget, the numbers might indicate that you couldn’t possibly save a single penny. And based on your current expenses, that may be true. But, there are ways you can cut back your spending, even on things you need to spend money on.

When it comes to cutting back, sometimes you have to make some tough decisions about what you’re spending money on. For example, you can’t just ditch your car note, but maybe you can trade-down to a cheaper model. The same thing goes for your mortgage payment. While you can’t just stop paying your mortgage, you may be able to shop around for a home with a lower mortgage payment.

Look at every single expense in your budget and evaluate whether you could switch providers for a lower monthly cost.

Technorati Tags: banking, Banks, Finance, financial planning, how to save money, personal development, personal finance, save money, saving money, savings accounts