Who wants to save a little more money this year? It seems to be universal. Its why Clark Howard has become the Mecca of spending less and saving more.
Let’s face it, it’s so easy to spend. Retailers are expert at helping us part with our dollars. And it feels so good to spend, doesn’t it?
In the end, though, how much of what you buy becomes meaningful in your life?
Wouldn’t it also feel good to have an extra thousand bucks, an extra ten thousand bucks, an extra anything each year? Imagine if you could…
Let’s see… $1,000 invested a year for 20 years, earning a compounded 8% return, would yield $49,422.92. Not bad.
What if we could extend this from 20 years to 30 years? It becomes $122,345,87. Even better.
What if we could save $10,000 a year for 20 years? 30 years? Holy Moly. Real money for you. Real money for your heirs, real money for your legacy, real money for a comfortable retirement.
Here are 4 simple to use and powerful techniques to save money:
- Number one on my list is extraordinarily simple, but for many difficult to implement. It goes to the very nature of you. If you can truly understand the priorities in your life, spending automatically falls into place. This is the very essence of my practice, helping folks understand what is important to them. Not to me, but to them. So, take out a piece of paper. Write down your priorities, one to five, one to ten, one to whatever. Put the list away for a day or so. Then bring it back out and re-order it. Think about number 1. And compare it to every other item on your list. Is it still number 1? If so, fine. If not, move where it belongs on the list. Then, move to number 2. Same thing, same process. Repeat. And repeat. In the end, you will have a list of the priorities in your life. What is most important. And what is second important. And so on. Transfer your list in order to a 3″ X 5″ index card. Fold the card in two. Fold it again. Continue to fold it until it reaches quarter size. Then put in your pocket, in your purse, in your shoe. Put it where it will be a constant reminder of your life. You will be astonished at how your spending will reflect what is ultimately important to you.
- Next on my list is a spending journal. It works every time its used. You can get a little pocket-sized journal at Walmart for a buck. It fits easily in your pocket or wallet or purse. Journal every expenditure. Write down every pack of gum, every latte, every light bill, every everything. Once you understand where your money is going, it becomes much easier to understand what is important in your life. You will begin to self-regulate and spend more wisely. Don’t try it, do it. It works.
- Never spend a dollar bill. If something is $2.89, use a $5 dollar bill. Etc, and over and over. The change and dollars will add up. It’s like vacuuming nickels. You will be amazed and surprised at how much money accumulates in your cookie jar simply by not spending dollar bills.
- Use a cash-back credit card instead of your debit card. Particularly if you are self-employed or a business owner, running your business expenses and your personal expenses through a cash-back credit card can deliver a tidy sum once a year. American Express Blue, Capital One or Discover are good choices. Automate every-month bills like your auto insurance, power and gas, internet, etc. Ditto for business expense. Most of these cash-back cards offer between 1% and 5% cash back depending upon what and where you buy. So, let’s say you can average 1.5% off of $50,000 of annual spending. That’s $750 cash back in your pocket. Of course, you absolutely must pay the card off in full each month, or this is self-defeating.
There are dozens of ways to spend less and get more. In the end, it is personal, what works for you as an individual and family. To learn more ways to spend less, save more and enjoy a rich life, check out MikeSenaCFP.com.