Actually Enjoy Saving Your Cash With This Alternative Savings Strategy
Budgeting isn’t always a walk in the park. There are some of us that get hooked on the budgeting high, and others of us that lack the inclination altogether. If you think limiting yourself to the bare necessities in order to travel or invest in things for the future sounds like a pretty boring way to live your life, there is another way to survive.
The money geniuses over at The Financial Diet have come up with this helpful solution for us saving newbies. It’s a ‘gateway’ savings strategy that’ll make you enjoy saving cash, even if you’re bad at saving.
It’s a big call, we know, but the strategy is actually pretty simple: it’s all about honing in on your *extra* money, and popping 50% of that into your savings. This way you’ll begin to save without making huge and difficult life changes – you can have your cake, eat it and save a little in the process too.
This saving strategy is about focussing on all the additional money that comes your way – money that’s outside your regular income. Things like birthday money, money you make from a side-hustle, work raises and bonuses, money you get from selling your stuff, tax refunds, an inheritance or even just money you find on the ground – anything, really.
This new savings strategy is a great way to get the ball rolling on a permanent savings plan. Why? For one, it’ll help you start to form healthy financial habits yet won’t scare you off saving. Just the thought of “extreme budgeting” – where you limit spending to the bare necessities or save 50-75% of your income – can make people crumble and vow to never try budgeting again.
Secondly, you’ll continue to be able to spend the money you earn and you won’t feel bad about spending it. If you’re saving half of your extra income, it lets you keep your lifestyle the same until you’re really ready to kick things into high gear.
Probably the best part of the whole strategy is that it gives you a rule to follow. Because that 50% you’re saving is coming from “extra” income, you won’t even miss it when it goes into your savings account.
There is one thing you need to be wary of, and that is the potential hiccup of not setting up a separate high-interest savings account. It’s all well and good that you take the initiative and actually bank that extra dough, but if you just spend it without realising, what’s the point?
So if you’re motivated to go off and start selling your unwanted clothes or reap the benefits of that side hustle, make sure the extra money is going into separate savings account. It’s one gentle way to easy into a saving strategy.
Rebecca Russo is a freelance writer, editor, community radio dabbler, occasional hiker and celebrity autobiography enthusiast. She has written for online publications including Junkee, AWOL, Fashion Journal and Tone Deaf. Find her online here.