It’s hard to save! You have to manage budgeting, recording what you spend and oh don’t forget those concert tickets you just bought that blew your budget! Then you start all over again! What if I told you there is a simple way to save? I learned this trick in high school and it has worked wonders in helping me pile money away.([tweetthis]I learned this trick in high school and it has worked wonders in helping me pile money away.[/tweetthis])
The trick is to set up direct deposit for two bank accounts at two DIFFERENT banks. The primary goal of the first bank will be accessibility. Opening a checking account provides you the best access, I would pick a bank (if you haven’t done so) that has the most ATM’s in the area you live in. Think of using the first account as funds for your day-to-day operations.
The next step is to open a savings account at the second bank. You may be asking yourself, why don’t you just open a savings and checking account at the same bank? That’s a great question and the the answer is quite simple, you’re creating barriers for yourself. For the second bank you want to limit the accessibility you have to avoid the temptation of impulse spending. The second account is solely for saving. To take it a step further, find a bank with the highest interest rate in your area (or online) to build your savings through compound interest! Sure, interest rates are low now, but it will be helpful when you’re adding more “0’s”!
After the bank accounts are set up. The next step is setting up direct deposit through your employer. You should be able to set this up on your own. If not, you should ask Human Resources if they can set it up for you. The amount you decide to save is up to you. Since my expenses are low, I am able to save half of my income.
When determining the portion you want to save, ask yourself, “how much do I want to save? Do I want to save for that Vegas trip in the summer? Do I want to set up an emergency fund? Or maybe I just want to get out of my parents house some day, but when? The best way to determine the amount to save is by making savings goals ([tweetthis]The best way to determine the amount to save is by making savings goals[/tweetthis]). You might set a goal of saving $500 each month to get an apartment by 2018. Setting concrete, yet tangible, saving goals give you a purpose for saving and makes the whole process easier. With that being said, you now know the trick!
This is one of the best techniques for saving!([tweetthis]This is one of the best techniques for saving![/tweetthis]) Determining your budget and deciding how much money to save is the most difficult part. Once you know how much to save, it’s easy! Your savings will be stowed away in a separate account and you won’t even have to think about it.
So how will this trick help me gain wealth?
At the end of the day, you worked very hard to earn your paycheck. No one deserves to get paid before you do! Paying others before you pay yourself is not a wealth builder’s mindset. Wealth builders pay themselves first then manage their expenses. The trick I described above not only develops the habit of paying yourself first but it allows you to easily save money. Before you know it you’ll have thousands of dollars at your disposal that you can use for a rainy day. No one has gotten through life without having rainy days. This automatically provides you with an emergency fund that you can use to cushion the blow when hard times arrive.
I’d love to hear your thoughts on saving. Do you have a trick you use that works best? Comment Below!
Edited by: Nigia Cusic
