Budgeting and Savings Strategies for Strapped Consumers

Stagnant incomes and rising costs for everything from bacon and eggs to heating oil have consumers feeling jittery. With a rather gloomy economic outlook for the near future, families are tightening their belts and examining where every penny goes. With personal savings at an all-time low, it might seem impossible to actually build a nest egg for the future. With a few tips and tricks like these, your coffers can start to grow, even when times are tough.

Why Save?

Not so long ago, credit was only for the wealthy. Ordinary folk had to pay cash or use outdated methods like layaway. The modern revolution in credit changed all that, and as a result, reduced the need to save for life’s necessities. Credit in all its many forms is a tremendous benefit, but it has lulled us into some bad habits. Spending every dime we make leaves no room when financial surprises occur. Savings can make all the difference in dealing with the unexpected as well as achieving long-term goals.

Strategies to Start Saving

Coffee cans, cookie jars, piggy banks and the mattress were the places our grandparents liked to stash their cash. Don’t go there. Open a savings account at a bank or credit union. Contribute to it via payroll deduction to make it easy. Start small. Even $5 or $10 per paycheck will help. This money is strictly hands off. Think of it as the 911 fund. Saving for major emergencies is a good start toward better financial stability.

Long Haul Savings

A simple savings strategy for long-term needs is using the dirt-cheap option of U.S. Government Savings Bonds. For as little as $50, individuals can invest in government backed bonds that will pay interest, and may offer tax benefits, especially if the bonds are used to pay for educational expenses. As investments go, risk is low. The return is modest too, but more dependable than stocks. Bonds can be part of an effective savings strategy for big-ticket items like college. The key is letting the money collect interest over a long period of time. Don’t confuse long-term savings with emergency fund savings. Both are needed.

Savings Diet

Starting a savings plan is a bit like going on a diet. Eliminating the junk food, midnight snacks, and counting calories are boring but effective diet tools. Carving out a few dollars to devote to savings is much the same. Vices are easy to target but let’s face it; most of us won’t give up a beer with friends to meet our savings goals. Try to view savings contributions like a utility bill. Going without water or energy isn’t an option. Going without savings shouldn’t be either.

Sneaky Savings Strategies

Congratulations on that raise or yearly bonus. Gifts, inheritances or any financial windfall is an opportunity to save. Just take a small slice and set it aside. Next time you get a raise, take the opportunity to increase that emergency fund contribution from $10 per paycheck to $20. It’s a painless way to save more.

Savings strategies like these will slowly help make the shift happen. Make savings become just another tool to get what you want, instead of what your creditors want.

By: Alex Wilson

Article Source: http://www.directorys.uniquearticles.info

Maximize your household budget with easy budgeting tips. Our personal finance budgeting tips and money saving tips will help you to spend less, save more and enhance your quality of life.

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