How to Save More Money This Year

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Whenever people talk about getting financially fit,

the first thing they recommend is to save. It's basically the low hanging fruit of adulting but telling someone with bad money habits to “just save some money” is not the best way to help.

For starters, taking the money you have come to depend on and saving it is a hard adjustment. Even if you manage to get some money put away, it almost always gets taken back out before you have amassed anything real. I was one of these people - you get a few hundred bucks stashed finally and one financial hiccup sends you back to the savings account to retrieve your hard-won savings. It's a revolving door but there are a few tips that helped me get some money saved and keep it that I want to share with you.

All Savings Accounts Are Not Created Equal.

Of all the things I am going to tell you, this the one that was most important to changing my financial behavior. When most people start out they have one savings account and no goal other than to save something. It's a doomed approach. Instead of having one catch-all account - have accounts with goals attached and segment the money.

For example, you have determined that you can afford to save $150 per month. Instead of directing the total $150 to one account for an emergency fund, break it up to cover multiple purposes. To start, try directing $75 to a mishap fund and $75 to an emergency fund. What is a mishap fund? It’s a savings account for things that are inevitable but low level like car repairs, covering unexpected bills, traffic tickets, etc. The biggest threat to our savings account is always the mishap stuff, right? So plan for it. Keep this account at $500 - $1000 (more if you can or have a family... cause kids).

Then you can take the other $75 and have an emergency fund for the really big stuff like a loss of a job or illness (it's untouchable otherwise). As you earn more you can have more accounts with other goals like a travel fund.

The point is to save for the smaller things that used to wipe out your total savings and still have money for the big issues should they happen. Yes, it will grow slower but at least it's happening and because you have a fund for that traffic ticket or blown out tire, they will not devastate all your efforts.

Automate it.

The worst way to start to save when you have never done so before is to assume you are going to move money manually. It's 2018 and a better life exists so get with it. Set up a direct deposit to a savings account with your bank or employer. It’s super easy and on payday, you will have saved money before you buy that round of drinks at happy hour! For more on this read my post, 4 Quick Ways to Break Bad Money Habits.

“I was one of these people - you get a few hundred bucks stashed finally and one financial hiccup sends you back to the savings account to retrieve your hard-won savings.”

Pay yourself FIRST… no… really.

When I say pay yourself first, I mean when you get more money put more money away before you determine that new car is “doable”. The worst mistake we make is spending more because we make more.

At this age, we are relatively early in our careers and just starting to climb the ladder and with that comes more money. Once you have gotten out of the check to check and value meal phase of your life - start to think about how much more you are spending with every increase. Enjoy the spoils but remember the more we earn, the bigger that 6-9 month emergency fund should be.

I am under no illusion that this goal is easy to reach but it took me 8 years to be laid off one time. Think about that, for 8 years I could have been putting away money every paycheck to get to this emergency fund. Start working towards this goal today, even if you only get to 2 or 3 months - at least you know for 2 or 3 months you are ok.

Like many of us, it took me a long time to realize I was living life wrong financially and I have still not mastered it (I do not expect to either). It's hard because the older you get your needs change, you want more - you tell yourself “I deserve this”... more. The turning point for me was being faced with medical bills and later being laid off as I mentioned. My head was totally in the sand - I looked around and noticed I was maxed out and blowing money fast on things I either could not remember or was bored with already.

When you are thinking about your goals for 2018 making sure you have a plan to save more is critical because it supports all other goals. New businesses, better travel, better fitness all work better when you have made plans to be able to afford them.

If you have used these or other methods to save more, let us know in the comments below.

Lisa Necole Nwachukwu is a marketer from Atlanta. She enjoys travel, cooking, and writing. She is a a news junkie, lover of podcasts, and a book hoarder. Lisa also enjoys finding new ways to get motivated and encourages others to do the same.

Visit her blog at lisalivewell.com.

Twitter: @TheLiveWellGirl

Instagram: @LisaLiveWell