If you’re in a lot of debt, saving some extra money on the side can seem nearly impossible. With all the different types of debt, who could ever figure out a way to save money on the side?
It may be difficult, but it’s certainly not impossible. Here are some quick and easy tips for saving a little extra spending money with a tight budget.
First and foremost, calculate your debt. It’s important to know exactly how much you owe. Many people vastly underestimate how much debt they have. In fact, as of 2013, actual lender-reported credit card debt was 155% greater than borrower-reported amounts. It’s not recommended to attempt an alternative savings plan if you calculate your debt and find out you’d actually be losing more money in interest. That’s why you should make sure to thoroughly and accurate calculate your debt before trying to save — you don’t want to spread yourself too thin.
When you want to save money, it’s important to get in the habit of writing down everything you spend money on and the amount you spent. Don’t just rely on your banking app to get it right for you — writing down all your spending can make you less likely to spend money on frivolous items. After one month, look back and reflect. What could you have gone without?
After examining your spending for one month, allocate a budget for bills, groceries, and any other weekly or monthly expenses you might have. Determine your monthly budget and make sure to stick to it.
When you go to save money, determine what it will be used for or set a goal to save a certain amount by a designated date. Doing this will make you more likely to stick to your goals, but it requires a lot of willpower, determination, and prioritization.
After you have a goal in mind, look at your budget and set a reasonable amount to save weekly. Even if it’s just $10 or $20 a week, the savings can really add up fast. Try to find a high-interest savings account so that your savings can actually make you more money. It’s also a good idea to set up automatic transfers from your checking account to your savings account — if you don’t see the money, you’ll be less tempted to spend it.
Finally, don’t give up! Again, saving money is definitely difficult, but certainly not impossible. Don’t be too hard on yourself if you’re not meeting your goals, and don’t let your frustration get the best of you. Saving money takes time, effort, and above all, patience.
If you need help managing debt, look into refinancing options such as debt consolidation, credit counseling, and other debt relief options. Don’t be afraid to take charge of your debt and get your life back.