How to Save Money on Big Purchases

Saving for Something Big

How to Save Money on Big Purchases

The idea of saving for something big– the down payment on a car or a long European vacay–might feel impossible, especially if you’re just getting to a point where you aren’t living paycheck to paycheck. But take heart! with any other big challenge, saving up for a big ticket item is doable: You just have to take it one step at a time.

For the purpose of this post, we’re talking about goals that might cost anywhere from $1,000 to $10,000 or so: Certainly a lot of money, but an amount you can probably scrape together within a few months or years.

It doesn’t matter what your goal is–these savings tips will be helpful whether you’re trying to plan a trip to Cancun or put a down payment on a house.

Saving for something big

To get started, take the time to create a budget for your goal. How much money will it actually take to make it happen?

Some big purchases might be fairly easy to estimate–if you’re interested in buying a specific model of car, you can do some research to figure out how much others have paid for it. You can also find information about the cost to maintain the car, and how much gas will cost you each month to come up with an overall total you’ll want to save.

Figuring out how much to budget for other big purchases might be harder to estimate: a trip to Europe. The total cost will depend on where you stay, how much you spend on airfare and other transportation costs, and how much you choose to indulge in local delicacies.

There might be other associated costs to save up for, too–for example, if you want to take a longer vacation but you have pets at home, you’ll need to include boarding costs in your budget. If you don’t have a passport or the right kind of luggage for a long trip, you’ll need to pay for those as well.

If you have a friend or family who recently made a similar purchase to the one you’re planning, ask them to help you come up with a realistic budget.

Write down everything you’re including in your budget, and ask them to let you know if there’s anything you’re forgetting.

A little research can also help you figure out everything you’ll need to include in your total (for travel budgets, try looking on Pinterest).

By when?

Once you know how much you’ll be saving, it’s time to set a due date to put your plan into action! This will help you figure out how much you need to save per day, per week, or per pay period in order to make your goal a reality.

Be sure to think through when you’ll actually need the money, which might not be the same as when you plan on doing the goal.

For example, If you’re planning a vacation, you might need to purchase flights or pre-pay for other parts of your trip in advance.

If that’s the case, set your ‘due date’ for your goal for when you think you’ll be making those purchases, instead of when you’d actually to leave for your vacay.

How will you fund your goal?

The best way to save for something is to save automatically! If you have it in your budget, set up an automatic deposit into the account where you’re saving for your goal!

If you create your Goal in Simple, you’ll be asked to create a Funding Schedule for your goal. This lets you choose how money will be added to your Goal–whether it’s every day, every time you get paid, or on some other schedule.

If you already have Direct Deposit set up for your Simple account, then this should be easy. When you’re creating your Goal, just create a Funding Schedule that aligns with your payday!

Once you have all the details of your goal figured out, it’s time to find ways to help you save for it even faster.

Don’t worry: This doesn’t mean you have to constantly scrimp and sacrifice in order to meet your goal.

In fact, you’ll be more ly to stick to it if you find realistic, small, automated ways to help you save, instead of relying on willpower and big lifestyle changes to make it happen.

If you have a Protected Goals Account, Round-up Rules is a tool in Simple that can help you save extra money. When you turn on Round-up Rules, we’ll save the change every time you swipe your Simple Visa® Debit card. Whenever your saved ‘change’ reaches $5 or more, we’ll transfer it to your Savings Goal!

Here are some more ways you can save extra money every month (or protect the money you’ve saved) to help you achieve your Goal faster!

Set up an account buffer

An account buffer is a stash of money (think one to two weeks of living expenses) that you use to cover expenses that you maybe didn’t plan for– if you get a crack in your car’s windshield and have to pay your $250 car insurance deductible to replace it.

Having an account buffer will help you avoid the temptation to dip into your savings when money is tight, so it can keep growing!

Look for opportunities to reduce your Expenses

If you already have a pretty good understanding of your recurring monthly Expenses, run through them to see if can cut back anywhere on a regular basis. (If you’ve never tracked your spending before, here’s a guide to get you started.)

Think big first, then small. If you aren’t making a lot of use your gym membership because you’re enjoying running outside–cancel it.

If your apartment lease is up soon and you could save by getting a smaller place or sharing a space with a roommate, that could be a great way to save more every month–but obviously moving isn’t a realistic or cost-saving option for everybody.

Luckily, there are lots of ways you can try to reduce your monthly Expenses. Maybe there is a way to lower your utility bills or cut down on some subscription services to save a little more each month. Maybe you’ve been paying for more phone data than you actually need, and can change your plan to save a few bucks every month.

Wherever you find savings, try to increase your monthly goal contribution by that amount: So if you figure out that you can save $10 a month on your phone bill, edit your Goal in Simple to contribute ten extra dollars each month. That’s $120 more you’ll be able to contribute to your Goal in a year!

Cut down on discretionary spending

Once you’ve looked at ways to save on your monthly living Expenses, think about some other spending habits you could change to save more money each month.

This isn’t about giving up the things you love, or that bring you joy. It’s about finding ways to spend less money on the things that you don’t really care about: if you can save money just by getting your favorite vitamins online instead of from a drugstore. Or if you’re willing to switch to kitchen towels instead of using paper towels (yay Earth!).

Take a look through your recent transactions and see if you spot any opportunities for finding cheaper alternatives. If you’re having a hard time finding a suitable, frugal substitute, take a moment to think about why the purchase is important to you.

Maybe your daily afternoon trip to the coffee shop isn’t about the caffeine rush—it’s about getting the office or chatting with the friendly barista.

If that’s the case, then making your own coffee isn’t going to cut it, but a walk with a friend (while drinking that coffee) might.

Pay off debt as you go

The longer you’re in debt, the harder it is to get debt–and the harder it is to work toward your other personal finance goals. If you are currently carrying debt (especially high-interest debt credit card debt), check out this post about how to pay off debt and save money at the same time.

Getting that hole quickly will not only help you in the long-term, it will also make it easier to get laser-focused on achieving your goal!

Find other ways to earn more money

If spending less isn’t feasible, or you want to accelerate your savings rate, look for ways to earn more. Consider picking up a little freelance work (here’s some tips for budgeting as a freelancer), or selling something you’ve made or own (but don’t need). If you think you are in a position to ask for a raise, go for it!

If you have a room available in your house to rent, consider getting a roommate. Just with spending less, little sums add up quickly—just an hour or two of work per week can make a big difference.

Watch your money grow!

You’ve already done the hard part, by creating a plan and making all the tough decisions. All you need to do now is go about your daily life (cutting back or earning more where you decided to do so).

We highly recommend taking the time every few weeks (or days, if you’re Goal-obsessed us) to check your progress. Saving can mean sacrifices, especially if you’re changing your spending habits or there are other temptations you’d to spend money on. Taking a few moments to think about why you’re saving and watching yourself get closer to that Goal will keep you focused on the bigger picture.

Adjust as needed

You might be able to stick exactly to the original plan. Or, you might run into unexpected expenses. Sometimes, you can adjust by changing your behavior. If groceries cost a little more than expected, it’s easy to spend a little less on restaurants. But what if your car breaks down and it costs $400 to fix?

If you fall behind on a Goal, you’d to pause it, or you need to pull money out to pay for an emergency expense, don’t worry—it’s easy to make an adjustment. If you stick to the original completion date, we’ll automatically show you how your savings rate needs to change. If you decide you need more time, you can edit the Goal to choose a new end date.

Celebrate!

One day, after a few months, a year, or a little longer, you’ll be done! Take a moment to think about what you’ve just achieved. Saving takes persistence and sometimes, sacrifice.

We build tools to show how little changes can add up to amazing things—while you put those changes in action. You should be proud (and even if you’re not, we’re proud of you!).

And now? It’s time for you to do that thing you’ve been dreaming about.

Create a Savings Goal with Simple

If you have your sights set on a big purchase, we’d recommend this as your first step: Create a Savings Goal where you keep money specifically dedicated to your goal.

Here’s why: Creating your goal will help make it real –and will set you up to start saving for it automatically, or on a regular schedule.

You’ll also get the benefits of a Protected Goals Account– a competitive interest rate and protection against accidental spending!

Источник: https://www.simple.com/blog/saving-for-something-big-with-goals

How To Save Cash For A Large Purchase

How to Save Money on Big Purchases

Last summer my husband and I bought a log cabin. We got what looked an amazing deal on the surface but we went into the home buying process knowing that 1) taking care of a log home is more costly than owning many other types of residences and 2) our “deal” was going to need some work sooner rather than later.

The two big problems with the house were that the roof needed replaced and the house had logs that needed repaired and refinished. We promptly got a new roof and then started saving our pennies for the more costly log repair.

Our repair estimate came in at a whopping $17,000 – more than I had thought it would be.

Since we are both against unprofitable debt (except for the mortgage) we knew that taking out a loan for these repairs wasn’t going to be an option.

We both wanted to make the repairs sooner rather than later so we decided to save cash. This month we’ve officially saved for the expense plus a little extra just in case.

Here’s how we saved cash for such a large purchase.

I Made Sure Our Emergency Fund Was In Place First

I firmly take the stance that everyone needs an emergency fund. Without one there’s just too much that could go wrong.

Before we even started saving I made sure our emergency fund was full plus made sure we kept an extra buffer in our checking account. (Yes, I to have buffers for my buffers!) Spending our emergency fund was the question.

My first recommendation when saving cash for a large purchase is to make sure your emergency savings are adequate. Typically 6-8 months of expenses is enough.

I Broke Down The Goal By Month According To My Deadline

I started saving for the repairs as soon as we closed on the house – long before we even got an estimate. By the time we got the estimate I already had more than half of the cash saved and then broke down the goal from there.

I could tell that over the next few months I was going to need to save around $500 per week to hit the deadline I was shooting for. I started paying more attention to my spending and funneling as much extra money to my online savings account as possible.

Had I broke down the goal earlier, and knew what I needed to be saving, I’m sure I would’ve hit my goal sooner. Having those monthly amounts to shoot for was very motivating.

I Automated Our Savings

One of the benefits of me being a freelancer is that I have several different income streams. Rather than only getting one paycheck from one employer I receive income from more than a dozen places each month. While this is a hindrance for some I actually love it.

Having multiple streams of income allows me to choose just a couple to use for regular expenses and funnel all the others to various financial goals. I decided to use a couple of my larger sources of income and automatically have them deposited in my savings.

If you don’t have multiple income streams it doesn’t mean you can’t use this method. In fact, automating your saving is one of the smartest things you can do. It completely removes the need for willpower.

If you’re saving for a large purchase break down your goal and then have the money automatically deducted from your paycheck or checking accounting each month or week. A great free tool to help automate your savings is Qaptial. Check it out and read our Qapital review here.

I Saved Lump Sums

For me, lump sums of money always seems the easiest to save. For instance, I overpaid my taxes last year and ended up (surprisingly) getting a refund of around $2k. Since I was actually expecting to owe money rather get a refund, sending that cash straight to savings was easy to do.

I’ve also received a few work related lump sums I wasn’t expecting in the past couple of months. These went straight to savings, pushing our account a little bit past what it needed to be to pay for the repairs.

If you come across an unexpected windfall send it straight to your savings account.

Other Tips To Make Your Savings As Easy As Possible

Follow a Budget Until You Reach Your Goal – After I got the estimate for the repairs I knew I had to cut back on some of the frivolous spending I was doing. While I’m not normally one to take extreme frugality measures I did cut my spending back during the last few months of savings, until I hit my goal.

Create a Specific Savings Account for Your Purchase – I love having specific savings accounts for each of my goals. It’s nice to be able to look at an account balance and quickly see how close you are to being fully funded. You can create separate savings accounts (for free) at an online bank Capital One 360.

Take a Temporary Break from Other Financial Goals – One of the largest financial goals I have is paying off my mortgage early. I’ve made great strides this past year but took a pause to finish saving cash for our repairs. (I kept other more important goals in place saving for retirement and my kid’s college.)

Pick Up Extra Work – There are thousands of ways to earn extra money. If you want to reach your goal faster consider picking up some more work. Here are over fifty ideas if you don’t already have one.

Have a Firm Deadline – Having a firm deadline is such an enormous help. Without a deadline it’s easy to feel you’ll be funneling all of your extra cash toward this goal forever, which just isn’t reality. When you have a deadline in place you can look toward that deadline and know how close you are to achieving your goal.

Saving Cash for a Large Purchase Takes Patience and Perseverance, But It’s Worth It

I’ll be the first to admit – saving cash for a large purchase isn’t always fun. There were definitely days where I would’ve rather done something else with my money. In the end I knew it would be worth it to save as quickly as I could so I could get the work done and over with.

On the days when you feel giving up, keep going anyway. Focus on watching that balance grow and knowing that you’re hard work is going to keep you debt free.

What strategies have you used to save cash for a large purchase?

Alexa Mason is a freelance writer and wanna be internet entrepreneur. She is also a newly single mom to two beautiful little girls. She chronicles her journey as a single mom trying to make it big at www.singlemomsincome.com.

Источник: https://thecollegeinvestor.com/17918/save-cash-large-purchase/

12 Ways to Save Money for a Big Purchase – Tips & Ideas

How to Save Money on Big Purchases

Major purchases require major savings. And let’s be honest: Not everyone is a natural at budgeting and saving money.

Then again, few life skills come naturally to any of us. Anyone can learn to budget and save money better, and sooner is better if you want to achieve larger financial goals anytime soon.

Whether you aim to buy your first home, buy a car in cash, save for international travel, or start your own business, anyone can reach their savings goal sooner rather than later.

How to Start Saving for Big Purchases

Un swiping your debit card for a new sweater, saving up for major purchases requires patience, discipline, and strategy. It ly involves some sacrifices on your part, such as ditching the $5 daily Starbucks latte, if you want to reach your goal sooner rather than later.

Follow these steps to save money for life-changing purchases faster.

1. Research Affordable Options & Set a Savings Target

You may not need as much as you think you do.

Have you considered buying used rather than new? There are plenty of reasons to buy a used car over a new car or skip the new construction home in favor of a fixer-upper or restored historic home.

If you’re looking to buy electronics, such as a laptop, you can buy a late model less than a year old through peer-to-peer services Craigslist or Nextdoor for a fraction of the cost of a new model from the store.

Question your assumptions, because some things you should buy used rather than new.

Buying used isn’t the only way to save money on a major purchase. When you buy a home, location matters far more than whether the home was new construction.

According to Zillow, the median home price in San Francisco was $1,405,199 in late 2020, while in many parts of the United States (such as Baltimore), homes cost a tenth of that.

And you can live luxuriously on $2,000 a month in some countries.

Before you can create a savings plan, you first need a savings goal. Spare yourself months or years of unnecessary delays by researching the most affordable path to your desired results. How much will that path cost you? That’s your savings goal. But be mindful that if it takes you a while to save, you may need more money than the original goal.

2. Set a Timeline

When you set a goal, it needs a time limit. Otherwise, it lacks any sense of urgency and dies a slow death in the “maybe one day” bucket of procrastination.

Besides, without a timeline, how do you know how much you need to save each month?

Aim for a realistic but challenging timeline that pushes you a little. It should stretch you to achieve it, but it shouldn’t be so unattainable as to set you up for failure. In some cases, your goal may represent a moving target. For example, home values constantly change, and the longer you wait, the more you’ll ly need as a down payment.

3. Open & Label a Separate Savings Account

We all know money can burn a hole in your pocket, even if that pocket exists virtually as a bank account. People tend to spend the funds sitting in their checking account.

First, open a high-yield savings account with an online back CIT Bank. This should be specifically for your big purchase goal.

Most banks allow you to label your accounts, so name the account after your goal — if you’re saving for a mortgage down payment, call the account something “Down Payment for Our House.”.

Every time you log into your bank, the account name will remind you why you’re saving money rather than spending it on dinners, clothes, or gadgets.

And don’t feel obliged to open the savings account at your current bank. Many people find that if they can easily access their savings accounts, they raid them rather than leave them untouched. Open your savings account at a separate bank if you occasionally succumb to temptation. It will make it that much harder to raid.

4. Automate Your Contributions

People are fallible, and discipline always fails you sooner or later. So don’t rely on it.

Instead, set up automated recurring payments from your checking account to your labeled savings account. Schedule these for every single paycheck within a day of getting paid so you never have a chance to spend the money earmarked for savings.

Most employers even allow you to split the direct deposit for your paycheck, making it even easier. Part of every paycheck can then go directly into your savings account without you ever seeing it.

You can use third-party savings automation apps to transfer money specific triggers. For example, apps Acorns round up every purchase and transfer the spare change to your savings account.

5. Commit All Raises, Bonuses, and Found Money

Whenever you collect money you weren’t expecting, move it directly to your savings account.

That could mean a bonus at work, your tax refund, or an inheritance. The same logic applies when you get a raise. Rather than thoughtlessly spending more most people do (known as lifestyle inflation), freeze your current spending and adjust your automated savings transfer upward by your raise amount.

It’s less fun than going out to dinner more often, but you’ll thank yourself later when you achieve your big purchase months or even years earlier.

6. Avoid Derailment by Unexpected Expenses

One of the most common budget problems is planning for typical monthly expenses and ignoring irregular and emergency expenses.

Emergencies happen all the time. They take different forms — this year it might be a $2,000 car repair, next year a $5,000 medical bill, the next a $10,000 roof replacement. Stop looking at emergencies as outliers, and build an emergency fund specifically for sudden, unexpected bills.

Similarly, create a savings account for irregular expenses gifts.

According to historical data from the National Retail Federation, the average American family has inched closer to spending $1,000 on the holidays each year, with 2019 spending nearly double the average in 2002, when the NRF started tracking it. If you don’t budget for holiday costs throughout the year, expect your budget to go up in flames come December.

And gift costs don’t end with the holidays. Every year, your budget gets hit with countless special occasion gifts, such as birthday gifts, wedding gifts, and baby shower gifts. Budget for irregular expenses monthly so you aren’t surprised by these all-too-predictable costs.

Otherwise, your big purchase savings will be ripe for the raiding, derailing your progress.

7. Pause the Plastic

Credit cards make it easy to spend money you don’t have and rack up credit card debt. And that can throw a monkey wrench in your savings progress.

Payment data from Shift Processing shows consumers spend up to 83% more when they swipe with plastic rather than counting out cash bills.

Consider putting a hold on your credit cards until you reach your savings target. You can remove it any time, and if you don’t feel comfortable with a hold, take your credit card your wallet and tuck it in a safe spot. Try the envelope budgeting system for a few months. You’ll spend significantly less when you have to physically pay for every expense with cash.

8. Get Creative to Boost Your Savings Rate

If you want to hit your savings goal and buy your big purchase faster, think outside the proverbial box to save more money.

For instance, how much faster could you save money if you didn’t have a housing payment? Find a way to house hack to ditch your rent or mortgage payment and supercharge your savings rate.

If house hacking won’t work for you, try some simple hacks to save $12,000 per year.

9. Earn More Money

You can also widen the gap between your earnings and expenses by generating more income.

That could mean negotiating a raise with your employer, whether in your current job or a new position. Or you can try to find a new higher-paying job.

Alternatively, start a side hustle to earn more money outside your day job. You could delivery groceries with Instacart or start freelance writing. Beyond bringing in some extra cash, it can also help you develop new skills and expand your network. And you’d be surprised how many side hustles grow into a full-time business generating more income than your old day job.

The more you earn, the easier it is to save, and the faster you can afford your big-ticket item.

10. Consider Investing the Money

If you only need to save for a few months for your big purchase, a high-interest savings account suffices. But if your time horizon measures in years rather than months, earning a return on your savings helps you reach your goal faster.

Even so, look to low-risk, stable short-term investments for holding your savings. The last place you want to find yourself is having lost money rather than earned it.

At the same time, you also don’t want to lose money to inflation. Consider extremely safe investments Treasury inflation-protected securities to earn a return on your money and avoid inflation.

11. Share Your Goal With Others

When you share your goals with friends and family members, you commit to those goals. Suddenly, you find yourself accountable for meeting them.

A 2019 study Ohio State University found that people who share their goals with others — particularly those they see as higher status — significantly improved their odds of meeting their goals.

Commit to your goals to several people you respect, and check in with them every month to update them on your progress. The added social pressure helps keep you on track for hitting your savings goal.

12. Negotiate a Lower Price to Bring the Finish Line to You

Everything in life is negotiable. And the more expensive the purchase, the more room there is for negotiation.

Home sellers accept low offers all the time. The same goes for car sellers, both private owners and dealerships. With effective negotiation strategies, you may not need as much money as you first thought.

When the finish line comes into sight, start probing sellers with low offers to see if they will come to you. You might find an early end to your savings marathon.

Final Word

Major purchases feel daunting, especially when you first start saving for them. But the sooner you start, the sooner you can afford the big purchase you’ve been eyeing and change your life for the better.

When you hit your target and make your purchase, keep saving aggressively. You’ve established good financial habits, which is the hard part — continuing those habits is easy. Look longer term, think bigger, explore financial goals financial independence and early retirement, or setting aside enough money to cover your kids’ college tuition.

Few people regret saving more money and building wealth faster. Keep saving, and before you know it, you’ll hit ever greater milestones than your original goal.

What large purchases are you saving for? What are your plans to reach your savings goals?

Источник: https://www.moneycrashers.com/ways-save-money-big-purchase/

How to Save Up for Big Purchases: Complete Guide

How to Save Money on Big Purchases

Do you dream about driving down the freeway in a new luxury car? Maybe you want to move your family your apartment into a free-standing home? Perhaps you’re thinking about taking that trip to the island paradise of Tahiti?

Whatever your desire, it costs money to make your dreams come true in the modern world.

Unfortunately, for most of us, most of these ideas are our immediate reach when we think about the cash involved with a big purchase.

Today’s economy doesn’t provide us much opportunity, and with stagnant wages, and rising inflation – it’s a struggle to get by every month, let alone afford a big purchase.

However, that’s not to say that you can’t achieve your financial dreams. It’s possible to achieve your goals if you know what to do, and with this article, we intend to provide you with a roadmap to turn your fantasy into reality.

Get Your Mind Right

If you spend your days dreaming about your big purchase – then they will remain in the realm of fantasy. To manifest your vision, you need to get your mind into a place where you subconsciously chase down your goal, step-by-step, until you bring it into your reality.

As humans, we are all reactionary by nature. We react to our current environment, and our thinking process responds to the stimulus we receive every day. Therefore, if you want to acquire a big purchase, you’re more ly to think about how you can’t have it, than how you can achieve your goal.

Taking a proactive stance is the opposite of reactive thinking. By being proactive, you think about what you need to do to achieve it, and your mind switches gears. As a result, your subconscious activates your RAS.

RAS Stands for Reticular Activating System

The RAS comprises a network of neurons in the brain stem which projects anteriorly toward your hypothalamus to regulate your behavior.

As a result of activating the RAS, you start to see opportunities that you would otherwise miss. The RAS is the reason why when you buy a new pair of shoes; you suddenly begin to notice more people wearing them than you did before your purchase. In this case, the RAS works to identify the shoes because you start to think about them, and it brings them to your attention.

Using this piece of knowledge to your advantage will serve you in your quest to make your dreams come true.

To activate the RAS, all you need to do is enhance your focus, and ask yourself how you can achieve your goal.

  • Every day, stand in front of the mirror and stare yourself in the eyes.
  • Tell yourself that you will attain your desire, and ask yourself what actions you will take to make it happen.
  • You don’t need to know the answer to this question.

What you’re doing is forwarding the question to your subconscious, while activating the RAS. As a result, your mind will start to notice opportunities, and you’ll suddenly find that you are in the right place at the right time to attain the components that lead you toward manifesting your goal into reality.

While this may sound a bit kooky, there is clinical evidence to suggest it works. For example, if you focus on your goal, and ask yourself every morning, “how can I make more money?” You’re programming your subconscious to bring you the answer.

Don’t expect this strategy to make a big bag of money fall the sky – that’s never going to happen. However, don’t be surprised if one day, you find yourself working late, and the boss approaches you to commend you on your work ethic. Maybe they offer you a raise, or maybe they tell you to head up a new project in your overtime, allowing you to earn more.

While this may seem a coincidence, it’s not. Your RAS and subconscious made you start working a little bit later without you realizing, placing you in the position to get what you need to make your dream a reality.

There are millions of people who experience this phenomenon every year.

Get your mind right, and you’ll start to find yourself in the right place at the right time.

Read: The Minimalist Living Lifestyle: Complete Guide

Create a Savings Plan

After getting your head around your goal, and gaining the belief that you can achieve what you conceive, now it’s time to step on the gas pedal and make it happen. Work out how much money you need for your goal. Maybe its $80,000 for that new car, $350,000 for that family home, or $20,000 for your dream vacation.

  • Whatever the amount, write it down.
  • Writing the target down on paper, instead of typing it into your computer creates a physical connection between you and the goal.
  • A wise person once said that if you don’t write down your goals, all you have are dreams – and that’s so true.

Next, clearly define how you want to achieve that goal in realistic terms. Let’s use the example of the $80,000 car. You need $80,000, and that may seem reach – but that’s not the point of this exercise. Let’s say you give yourself 2-years to realistically achieve your goal. That means you need to save $6,670 every month to meet your target – that’s a tall order.

However, all it takes to activate the RAS, and subconscious is to start taking proactive steps toward this figure. Open a 24-month CD with the bank, and begin contributing everything you can spare to that CD. By doing this, you activate the subconscious, telling it to find a way to make more money to meet your target.

If you remain diligent toward your target, the mind will slowly start to look for ways to make more money to achieve your goal. You may only be able to get $2,000 into your account for the first few months, then all of a sudden you get that overtime opportunity, or start to look for opportunities to earn more income to fill the gap.

If you remain steadfast in your quest, you’ll eventually start to edge closer and closer toward your target. Your mind will begin to notice the small wins, and you’ll build momentum. Remember; what you think about, you bring about.

Read: Digit Savings App Review: Automatically Grow Your Savings

Examine Your Expenses

Do you know where your money goes every month? Do you use a budget to manage your expenses? If not, then you need to start taking advantage of this powerful financial exercise.

Write down a list of everywhere you spend your money. The rent, groceries, medical bills, debit orders, eating out – all of these need to go down on your list. Try to account for every penny you spend during the month, even the change you give away to people on the street while commuting home.

When you have your list, start to analyze where you can cut back on your expenses. Do you need your streaming services? Maybe you could get by with a lower-cost cellphone package? Could you be renting in a cheaper area of town? Perhaps you could save by avoiding eating out so much – or cutting out that second latte on the way to the office in the morning.

Make a concerted effort to save money wherever you can, and write down your savings at the end of every month. Send the extra funds to your bank account, and watch your investment grow toward your goal.

Being frugal in life may seem taking steps backward and away from your goal. No-one wants to admit that they can’t afford to lead the life they live. However, when you start to see the savings accumulate, you’ll strengthen your resolve and reinforce your behavior in your mind’s eye.

Pretty soon you won’t even miss your Netflix subscription, your new apartment may seem better than your old one, and that second latte is a distant memory.

If you’re having trouble with coming to terms with your downgrades, think about your goal and remind yourself why you are taking these actions.

Read: The Complete Guide to Living Below Your Means

Kill the Credit

We live in a society where many of us rely on credit to help us through the month. However, many of us misuse our credit, turning it into a form of usury that we find challenging to escape. If you find yourself maxing out your credit card every month, then it’s vital that you follow the second step in the process, and start to whittle down your expenses.

Use the savings you make on your budget to reduce your credit card debt and any outstanding personal loans. Credit facilities come with high-interest rates known as APR (Annual Percentage Rate). If your credit facilities are maxed out, the chances are that your bank is charging you an APR of around 20-percent to limit your bad spending habits.

If you have a credit card with a $5,000 limit, try to reduce your outstanding balance to a maximum of $1,000 per month. Always pay your card in full at the end of the month, and you can start to earn cashback through the rewards program offered with your credit card facility. If you don’t have a cashback facility, apply for a card that provides one, and get rid of your old card.

Add these cashback savings to your investments, and keep your money growing. By killing your credit, you leave yourself feeling financially sound, and out from under the thumb of crushing debt loads that derail your progress toward your goal.

Read: 4 Ways You’re Probably Misusing Your Credit: What to Look for

Don’t Waste Your Time

Many of us don’t understand how much time we waste in a day or a week. Do you know how many hours you lose every day? Going to work and exercising are excellent ways to make productive use of our time. However, what do you do with your spare time? Do you get home from work and laze around on the couch all evening?

Think of this example. Let’s say you return from the gym after work at 7 pm, have something to eat, and then turn on the TV at 7:30 pm. After an evening of relaxing, you retire to bed at 11 pm and then wake up the following morning to rinse and repeat the day.

In this example, that 3.5-hours you are wasting in front of a screen every day. Times that by 5-days in the workweek, and you get 17.

5 hours every week that you could be doing something else to move you toward your goal. Multiply that figure by the four weeks in a month, and that figure grows to 70-hours.

Multiply it again by 52 weeks in a year, and it becomes a staggering figure of 840-hours that you are wasting every year.

Considering that the average person works 40 hours a week, that’s 21-working weeks you are blowing every year in front of the TV or over 5-working months. Small amounts add up over time. What else could you be doing to reach your goals instead of sitting in front of the tube?

Create a Secondary Income Stream

Now that you know how much time you’re wasting, you had better stop snoozing and get moving. Find a way to make more money in your downtime. In our example, we didn’t even count weekends into the wasted tie equation.

Do whatever it takes to make more income for yourself. Volunteer for extra hours at work, or start a freelancing gig. Work as a bartender in the evenings, or learn to trade the markets after hours.

The point is to be more efficient and productive with the time you have available. Save watching TV for when you retire, and you’ll find money starts flowing into your savings faster than you can imagine.

Wrapping Up – Create a Vision Board and Stay Motivated

Working those extra hours and staying on track to meeting your financial goal for that new car is going to take dedication and effort, but no-one said this was going to be easy.

If you find yourself starting to feel distracted from your goal, create a vision board. Cut out pictures of the car you want from magazines. Visit the dealership and have the sales rep snap a photo of you sitting in the driver seat. Paste those pictures on a piece of cardboard in a collage, along with images of stacks of money.

This exercise continues to feed your subconscious and the RAS, giving you’re the inspiration to stay motivated to reach your goal. If you follow the advice in this article, it won’t be long before you revisit the dealership and drive your new car out onto the road. Congratulations, your dream is now a reality.

Источник: https://moneycheck.com/save-up-for-big-purchases/

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