Even if you earn enough to live comfortably, it doesn’t mean your bank account balance will be moving north. It’s very possible it could be near a relatively uncomfortable level.
For those who’ve been there, we feel your frustration. And if you’re ready to take action, then check this out: here’s a financial plan geared toward those who want to spend and save, comfortably, at the same time.
Here’s to feeling more power than pain when it comes to your savings. Just follow these five steps.
Instead of depositing your entire paycheck in your checking account, direct deposit part of it into a separate savings account.
Why: If you’re automatically saving money in a separate account, you could be less likely spend it. It’s called “paying yourself first” because you’re tucking away funds for your own goals before you pay others.
Also, saving on the regular can boost your chances of making steadfast progress toward your goals.
When your income increases you might be tempted to spend more and what were once nice-to-have luxuries could easily become must-haves. This is so common it has a name: “lifestyle creep.”
It’s possible to have it both ways – to enjoy things and put some of your new wealth to long-term goals. Here’s how: Commit to saving up a significant portion of any additional income you receive as a result of a salary bump and divert it to your savings account using direct deposit.
If you carry a balance from month to month you could be spending a lot of money on interest charges that you could use to bulk up your savings instead.
But you don’t have to swear off credit cards – who wants to give up great rewards? -- but it’s possible to use your credit cards more to your advantage.
Here’s how: try to pay your bill in full each month (keeping in mind other bills or financial obligations). If you need to carry a balance, consider paying more than the minimum if you can and consider budgeting to pay it off as soon as your budget permits.
Go through your subscriptions and cut the ones you no longer use and see if there’s a free version that offers what you want. Also look into sharing a subscription and splitting the bill with a friend or family member.
How this could add up: Closing an unused $10/month subscription would save you $120 in a year.
If you’re credit card offers cash rewards, claim them and save them! If you don’t want to use a credit card, consider options --like or a rewards app that offers cash rewards or discount codes at places for things you already buy at places where you already shop.
Discovering easy ways to save will boost your odds of sticking to your goals. Setting something up once or making a simple change or transaction every so often, could lead to steadfast progress.
Want to learn more? Check out other articles from Marcus on personal finance, savings strategies and more.
United Capital Financial Advisers, LLC d/b/a Goldman Sachs Personal Financial Management (“GS PFM”) is a registered investment adviser and an affiliate of Goldman Sachs & Co. LLC and subsidiary of The Goldman Sachs Group, Inc., a worldwide, full-service investment banking, broker-dealer, asset management, and financial services organization.
The information contained herein is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered investment advice. GS PFM does not provide legal, tax, or accounting advice. Clients should obtain their own independent legal, tax, or accounting advice based on their particular circumstances. Please contact your financial adviser with questions about your specific needs and circumstances.
Information and opinions expressed by individuals other than GS PFM employees do not necessarily reflect the view of GS PFM. Information and opinions expressed in this article are as of the date of this material only and subject to change without notice.