Savings

Poll

No one out there will tell you that saving is an easy thing to do. There are easy ways to save, but in general, saving is not that easy. If it was, no one would have debt, everyone would retire early and the world would be a pretty stress free place.

But the fact is that we like to spend money. Most of us spend everything we have out of every paycheck we make. Many of us spend more than that through credit cards, paycheck loans and other types of debt.

Saving is a key concept of managing your finances. If you want major things in life, sooner or later you are going to have to learn to save. Want to retire someday? Saving is how you get there.

Many people don't ever start saving because they are simply waiting for the day they have extra money to save. Let me tell you right now: there is no such thing as extra money. You have to look to what you have right now for ways to save.

By creating a budget you can create money to put towards your savings. When you have a budget that works for you and goals that you are working towards, you will find something to start saving. It doesn't matter if you can only put five dollars in savings each week -- it will grow and start working for you.

The first step is to figure out what you want to save for. You may want to own your own home. You may want to remodel your home. You may want to retire someday. Long term and short term goals are great. I like the short term because there is fast payoff. I save for new carpeting or curtains or a cooking gadget I've been wanting. I also like to save for my spring and fall wardrobe. It is more fun to go to the store with several hundreds of dollars than it is twenty here and there!

The second step is to set up a savings account to put your savings in. If it is in your checking account you will spend it. If you didn't, you'd have plenty of money in there right now. You can move money from your savings to other investments, such as CDs and stocks, when you have built up quite a bit.

If you don't have a budget you need to sit down and start one. It doesn't matter if you make hundreds of thousands a year or just thousands, budgeting is essential. It helps you see where your money is going and where you can move things around a bit. It helps you set goals and challenge yourself.

Don't worry if the first attempt doesn't work out for you. You may find that you have to adapt your budget over time. That is just fine. Budgets aren't written in stone. They are meant to change and evolve. When you find what works for you, stick with it. It may take a few months, but it will be worth it.

Pay your savings first. If your employer will deduct it from each paycheck and deposit it directly in your savings, you will have no worries. Believe me, you don't even miss it after a while. It just builds up while you do nothing. Some banks will do a transfer for you every month automatically. If not, make sure you do it before you spend any money out of your paycheck. Just get it over with.

Saving money takes a little thought. You have to think about where you are spending your money. You have to have self-control in impulse shopping situations. But like any habit, given time it just becomes part of your normal life. And it pays.

Martin Lukac represents www.RateEmpire.com, an Internet consumer banking marketplace. RateEmpire.com is a destination site of personal finance, investing, taxes and mortgage rates. RateEmpire.com provides mortgage guides and financial rates and information. RateEmpire.com also operates a financial portal #1 American Financial, found at www.1AmericanFinancial.com and San Diego loan portal www.LendingSanDiego.com