How to Save More Money in 2011

Stick to your savings resolution!

by Clarky Davis 

There’s no better time than the beginning of a new year to review the past and consider any lifestyle changes that could pave the way to a happier, healthier and more stable future.

Who isn’t seeking a new path for a better, more fulfilling life? A new year allows us to fantasize about all of the achievements we can accomplish if we make a few much needed alterations. But when it comes to putting ideas into actions to make our resolutions a reality--we often don’t get further than the fantasy.

Weight loss and living a healthier life are always the top resolutions, but saving money and increasing financial stability is a close second. Here are tips to make this goal a reality in the new year.

Make a plan. If you really want to achieve a goal, you have to implement a strategy. You must outline action steps and tasks that you are going to take in your life.

1. Boost your retirement savings efforts by increasing your contributions. Just saving one additional percent (or more if you prefer) to the minimum required contribution to receive the company’s match will benefit you in the long run.

2. Consistency is key. With each paycheck, have a specific amount of cash directly deducted into a savings account and leave the money alone. Build your budget around what’s available in your checking account. This may be a challenge at first, but when you see how rapidly your savings grows over time you will be pleased with your progress and motivated to put more money away.

3. Keep a spending journal by writing down everything you spend, so you know where your money has gone. Make adjustments at the end of each month to cut out meaningless spending.

Start Small. The key to making and keeping resolutions is to break down your goal into small milestones that you can reach over a reasonable period of time. For example, if your goal is to have an emergency savings account of $10,000, don’t pressure yourself into achieving that in six months – especially if you are living paycheck to paycheck. Instead, set a smaller goal of saving maybe $300 per month until you reach your ultimate objective of $10,000. It will take time, but you won’t become frustrated and give up.

Be Willing to Make Adjustments. As time goes by, things change and you will need to alter your spending habits so you can meet your savings goal. Unexpected expenses do crop up. From car repairs to fluctuating living expenses, you will need to closely monitor where your money is going so you can make smart money management decisions. Maybe you will decide to skip lunches out with your co-workers for a month or give up that cable package for six months so you can achieve your goals.