advantages of saving money

10 Reasons Why Saving Money Is Important Post-COVID

January 27, 2021 By Vicky Monroe Leave a Comment

The pandemic has shown us all that life can change in the blink of an eye. One day you can be employed, and the next you can lose your job through no fault of your own. This crisis is a salient reminder of why saving money is important. If you have a financial cushion, you’ll be able to weather challenges better.

Even after the coronavirus passes, you should still keep topping up your savings account to cover unexpected expenses like car repairs and medical bills. Saving up will also enable you to splurge on vacations and other wants without going into debt.

Before you go on and read about the top ten reasons why saving money is important, start saving by signing-up to these savings apps.

App	Fess and minimum:	Best for:
Digit	30-day free trial period. $5 per month	Setting aside automatically
Acorns	$1 per month	Spare change investing.
Qapital	$3 membership	Letting you set rules to automate savings.

Here are the top ten reasons why saving money is important in a post-COVID world.

Top 10 Reasons Why Saving Money Is Important

1. Career Changes

Studies have shown that four in ten jobs that went away during the pandemic may never come back. The industries that have been affected most are retail, restaurants, transportation, and warehousing.

If you’re in one of these fields, it may become increasingly difficult to find work as the number of available jobs shrinks. Saving extra money now can give you the cushion you need to retrain for a new career.

2. Emergencies

The pandemic has reminded us all that emergencies can happen at any time for reasons that are out of our control. Saving and building an emergency fund is important if you want to be financially prepared for unexpected events like health problems and unemployment.

3. Retirement

If a recession occurs toward the end of your working years, you may be forced to retire early.

Many workers in their fifties and sixties struggled to find new jobs after getting laid off during the pandemic. To provide for their families, some seniors took Social Security early, causing them to lose hundreds of dollars per month in retirement income.

To prevent this from happening to you, it’s important to have a robust emergency fund that can carry you through extended job loss.

It’s also a good idea to save a little extra money for retirement. That way if you are forced out of the workplace due to a recession or age discrimination, you’ll still have a big enough nest egg to live comfortably during your golden years.

4. College Funds For Your Kids

Many of the jobs that aren’t coming back after the pandemic are ones that only required a high school education. In the future as automation increases, it may be even more important to have a college education to stay competitive in the job market.

Setting your kids up with a college fund can give them the leg up in life they need and help them cover rising college costs without taking on lots of debt.

5. Buying a Home

Surprisingly, there was a big housing boom during the pandemic that caused home prices to rise substantially. If you want to be able to afford a home or investment property in this hot real estate market, you’ll need to start socking away some cash for a down payment.

6. Transportation Costs

If you’ve been telecommuting during the pandemic, you’ve probably saved a lot of money on gas and car insurance because you’re not driving to work. To prepare for increased transportation costs when you go back to the office, it’s a good idea to put the cash you’re saving now into a sinking fund.

If you have a fund set aside for car maintenance, you won’t need to worry or go into debt every time your car needs repairs.

7. Pay Off Debt

Tightening up your budget can help you put more money toward your debt and get it off your plate sooner.

Once you finally pay off your student loans or credit cards, you’ll feel a huge sense of relief. You’ll also be able to allocate more money toward savings and investments once your debt is gone, which will help you achieve your financial goals sooner.

8. Vacations

After being cooped up at home for months, you’re probably itching to take a vacation! Creating a vacation fund will enable you to take a nice trip once the pandemic ends without racking up credit card debt.

9. Medical Expenses

The coronavirus is an important reminder that even young, fit people can have a health emergency. Putting extra money in your HSA will help ensure that you can afford to see the doctor the next time you’re feeling unwell.

10. Peace of Mind

One of the biggest reasons why saving money is important is peace of mind. Having a financial cushion is incredibly reassuring because you know you can weather whatever challenges come your way.

Although it’s difficult to live below your means and delay gratification so you can save money, it’s definitely worth it to have a comfortable, financially secure life.

Diversify Your Income And Save Money

January 27, 2021 By Joe Wallace Leave a Comment

What does it mean to diversify your income in order to save money? If you are new to the idea of multiple income streams or multiple revenue streams, you might wonder why it pays to have more than one job. At least that’s true until you establish a financial goal you want to reach in as short an amount of time possible.

A traditional American way of life involves having one “main job” and many choose to work a part-time gig to help make ends meet.

That’s the simplest version of multiple income streams and a pretty effective one, too–especially if you choose a side hustle that pays well. Many choose gig-based work such as freelance writing, content creation, social media management, etc. while others may choose jobs that pay tips and reward good customer service.

But no matter what you choose, the outcome is the same–you have more than one revenue stream and if you plan your budget carefully you could find the extra money has the potential to pile up.

How To Diversify Your Income To Save Money

It’s not that you need any special coaching to apply for a second job–far from it. But what some people don’t realize about working more than one gig or adding a side hustle to help them save money? Being proactive to avoid burnout, job fatigue, quitting because of stress, etc. How do people who work all day at one job turn right around and report to ANOTHER job for part of all of their evening?

One way is to be smart about the side gigs you choose. Some people try to avoid getting a second job that is too similar to their main work. Do you work on your feet all day? A side gig that does NOT require you to keep standing a few hours more makes a LOT of sense.

Do you spend all your time answering calls, performing support work, or processing orders? Chances are good that a side hustle to help you get your financial goals accomplished should not feature any of these things.

Finding An At-Home Gig

Sometimes being able to work from home is the best, but some people simply don’t think to give themselves permission to look for such work. There are many customer service jobs that allow you to answer calls from your own home provided you have the appropriate computer/internet equipment to handle the work.

Other types of stay-at-home jobs involve writing, proofreading, editing, writing whitepapers or doing research, or even acting as a personal assistant. Check these marketplaces for job openings.

Platforms	Best For:
Fiverr	Finding Freelancers
Bark	Finding Unique Freelancers
Appjobs	Gig Economy Professionals

The key to finding such work lies in your ability to research local job posts, national calls for applications, etc. online using resources such as LinkedIn, Indeed, etc. But you can also find job-specific support groups and job boards. Have you looked in your local Facebook Marketplace, as well?

Turn A Hobby Into Income

Musicians, photographers, artists, woodworkers, and people good at crafting all find additional income opportunities by selling their wares or their skills online via Etsy, Patreon, and other platforms. You can diversify your income in this way, but it takes getting to know the various platforms and building a following there using best practices (NO SPAM!!).

While “turn your hobby into a diverse revenue stream” is fairly generalized advice, here’s one very specific thing you can do to see if you can turn your skills into income locally–look into local farmer’s markets, artist collectives, event spaces, and annual maker fairs to see if other people are vending or selling in ways you’re tempted to try yourself.

Don’t let the presence of “competition” worry you–this simply means there’s a real market for what’s being sold and you have a shot at that, too!

Turn Spare Change to Savings

Try these savings apps to turn your spare change to savings. It is never too late to start saving.

App	Fess and minimum:	Best for:
Digit	30-day free trial period. $5 per month	Setting aside automatically
Acorns	$1 per month	Spare change investing.
Qapital	$3 membership	Letting you set rules to automate savings.

Saving Money: Learning From Parental Mistakes

December 10, 2020 By Joe Wallace Leave a Comment

Learning about saving money from parental mistakes is not always the most fun thing to do, but when I look back over my own personal journey it’s obvious that I took the earliest cues from my mom and dad–for better or worse, and had to evolve from there. But what kind of parental mistakes are we talking about here?

There are the obvious ones–treating credit cards like an ATM, running up too much debt on one card and being unable to dig out completely without help, things like that. But the real education I got about saving money came from taking a tough and critical look at how I was raised and the money examples I was given along the way.

Here are the five things I have learned by doing this:

The nature of money and saving has changed dramatically since I was in high school back in the 1980s. It was changing in my parents’ early life together too, but the ability to adapt to a changing financial landscape is key to weathering those changes and have money left in the bank in the meantime. Adapt and survive.
It’s not enough to save money–you have to save money with a purpose. You remain committed to goals that are clearly defined and lose your resolve faster when you don’t.
Sometimes you have to make a game of your financial goals and treat them accordingly. In the same way you “Do Not Pass Go, Do Not Collect $200” in the game Monopoly, you’ll need to establish firm rules for the game (money challenges, saving challenges, etc.) and stick to them like they were written in stone.
You have to anticipate problems along the way that may set you back financially rather than treating every new problem like a completely unanticipated disaster.
You have to explain your money management strategy to the entire family and in terms they can understand and support.

Number five is especially important–or at least it was for me. When I was little, some of the most detailed financial advice I got was “You gotta pay yourself first.” Which I understood in general terms, but I didn’t know what that truly meant. If someone had taken the time to explain to me that you have to anticipate a flat tire, last-minute dentist visit, a cut in job hours, etc. by saving up for such things, it would have made a lot more sense to me in a pragmatic way.

Explaining these things clearly for spouses and children makes the difference between actually making progress in your financial planning with the support of your family and treading water with everyone asking why they don’t go out to eat anymore.

Making the plans? Crucial. But explaining how the plan works and getting everyone affected by them on board? That requires some additional thinking time. But it’s well worth the effort–especially when you’re trying to get the kids on board with a lifestyle change involving a more frugal approach to life.

Bonus : Giving technologies that help me save more a try. Here are some savings apps that are useful and worth a try.

App	Fess and minimum:	Best for:
Digit	30-day free trial period. $5 per month	Setting aside automatically
Acorns	$1 per month	Spare change investing.
Qapital	$3 membership	Letting you set rules to automate savings.

Saving Money During the Coronavirus Outbreak

April 10, 2020 By Tamila McDonald Leave a Comment

The coronavirus outbreak has shaken up the economy. Many people found themselves suddenly laid off or with their hours substantially cut. Rethinking daily finances is becoming a necessity, particularly since much is still uncertain. Luckily, saving money during the coronavirus is possible. Here’s how to get started.

Grocery Shop Smart

Once COVID-19 made its way solidly into the United States, a degree of panic overcame many shoppers. Quintessential household goods like toilet paper disappeared from store shelves early. Over time, as more Americans were placed under stay-at-home or shelter-in-place orders, households began to stockpile even more products.

While it’s certainly wise to be vigilant about your current stores and replenish critical items at a reasonable pace, don’t let panic dictate how you spend. In the vast majority of cases, clearing a store shelf of all of any item isn’t necessary. As a result, you’re paying a ton up front that doesn’t have to be spent.

While the coronavirus is creating uncertainty, strive to shop smart. Consider how much you genuinely require to meet your needs for a specific amount of time. Once you know, resist the urge to horde. That way, your emotions aren’t destroying your budget.

Additionally, opt for shelf-stable or freezable foods. Some fresh items can spoil quickly. If you are buying them en masse and can’t freeze them, there’s a decent chance some will go bad before you eat it. That means you’re essentially tossing money out of the window.

Resist Takeout and Delivery

Restaurants in a number of states are restricted to takeout and delivery only. As a result, many are fighting for every customer, inundating everyone on their email lists with deals meant to entice during these challenging times.

While the idea of having restaurant-level food show up at your door might be tempting, resist. It’s substantially more expensive than cooking at home in most cases, even with the deals. If saving money is a priority, it’s better to avoid restaurant food entirely.

Contact Your Lenders

Many lenders are offering those impacted by the coronavirus outbreak options for reducing their financial burden. For example, federal student loan interest rates are all at zero, and anyone can get a forbearance. This eliminates a monthly cost without a meaningful penalty, making it easier to adjust your budget during these trying times.

What’s available through other creditors varies. However, most major ones have some sort of program available. Reach out and you may be able to get a reduced interest rate, payment deferment, or other option that can make your outgoing debt repayments easier to manage.

Contact Your Vehicle Insurer

If you usually commute or otherwise put a decent number of miles on your vehicle but aren’t now because of the coronavirus outbreak, it may be time to call your car insurance company. You may be able to alter your policy because your mileage is dramatically less.

In some cases, you’ll be eligible for a savings because your car isn’t moving much. While it may only be a small reduction in your monthly expenses, every little bit does add up.

Reach Out to Utility Companies

If you’ve lost your job due to COVID-19, contact your utility companies, as well. There may be hardship programs that can help you keep your power, water, and garbage services even if you’re struggling to pay.

How the programs work varies from one provider to the next. However, it doesn’t hurt to ask if you aren’t sure you can cover this expense in the interim.

Downgrade Your Cellphone Service

When you’re spending all of your time at home, an unlimited (or high GB) cellphone plan usually isn’t a necessity. You can connect the device to home Wi-Fi, ensuring you don’t use much (if any) data while you’re under a stay-at-home order.

Consider downgrading your service level if you can do so without violating your contract and incurring a fee. Then, rely on your home internet instead. Connect your devices to Wi-Fi. Use a home computer for voice or video calls with family members and friends through apps like Skype, Zoom, and Discord. By doing so, you can reduce your cellphone use, ensuring a downgraded plan works, and you can shrink that monthly cost.

Do you have any tips that can help with saving money during the coronavirus outbreak? Share them in the comments below.

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.

How Do You Develop A Financial Strategy to Stay Out of Debt and Save Money

April 2, 2020 By Tamila McDonald 2 Comments

Total U.S. household debt hit $14.15 trillion in the fourth quarter of 2019. Based on a population of nearly 330 million, the average owed per person (including infants and children) is a startling $42,879. Many households struggle to get their debt under control. They may have issues making payments and get stuck living paycheck to paycheck. Making their savings goals a reality may seem impossible, leaving them scared and frustrated. If you want to live your best life, developing a financial strategy that keeps you out of debt is a must. If you don’t know where to begin, here are some tips.

Make and Follow a Budget

Having a clear, defined budget is critical if you want to avoid debt. It allows you to outline your expenses and gives you a way to set spending limits. Plus, you can allocate a certain amount to savings, which is a critical part of staying out of debt.

If you don’t have a budget, create one immediately. Tally up your income, list all of your debt payments and living expenses, and add a line item for saving. See how much you have available after covering those necessities.

If your income falls short, you may need to explore ways to cut back. If you have a surplus, then consider how it can be best used. You could bolster your savings, pay down debt, or otherwise find ways to ensure your financial well-being.

Get an Emergency Fund

A buffer is critical if you want to avoid debt. Without an emergency fund, you might have to turn to credit cards or loans to handle the unexpected. That isn’t ideal.

Begin by socking away at least $1,000. Usually, that amount is enough to cover home or auto deductibles, for a start. It can also handle many smaller emergencies, like a flat tire, trip to the doctor, or major appliance failure. You’ll have a safety net that you can use for those costs and replenish much more quickly and easily than if you were repaying a similarly sized debt.

Once you have at least $1,000, you may want to shift your attention to paying down high-interest debt, if you have any. After you square that away, work to stash three to six months of living expenses. Usually, that’s a sufficient enough cushion to weather even a severe financial storm.

Consider Going the Cash-Only Route

One of the benefits of using cash is overspending isn’t an option. The money in your pocket, purse, or wallet is all you have available. Once it’s gone, you can’t spend any more.

The cash-only route allows you to ensure you stick to your budget. You can pull out cash for each of your spending categories, like groceries or gas for your car. Next, place that money in envelopes designated for each purpose. When you make an associated purchase, use cash from the corresponding envelope.

Using cash can make your spending feel more real, essentially increasing your awareness of what you’re handing over and what you’ll have left. You might make smarter choices, as a result, and that can make a big difference long-term.

Plan Ahead for Large Expenses

Your emergency fund can become a sizeable cash stash, so it may be tempting to use that money for large expenses. But that isn’t the purpose of an emergency fund. It’s there to handle the unexpected, not what you know is on the horizon.

Whether you want a new television, will need to replace your roof, or intend to buy a car, make the cost part of your financial plan. You may want to create dedicated savings accounts for each one. That way, you can deposit into them regularly and build up the amount you need.

This approach essentially supports a broader cash-only lifestyle. Avoid making the purchase until you have the full amount, ensuring you don’t need debt to cover the cost. At a minimum, if an expense genuinely can’t wait, you can use what you do have stashed to lower how much you need to cover with debt. That can reduce your long-term financial obligation, making it easier to rid yourself of that debt as quickly as possible.

Do you have tips for developing a financial strategy that can help people stay out of debt? Share them in the comments below.

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.

7 Great Ways To Save This Coming Year

February 28, 2020 By Susan Paige Leave a Comment

Obligatory photo of dollars being stretched.

It is sometimes overwhelming how people tend to be a lot more conscious of themselves when the year ends and be a little cautious as the year starts anew. When you are looking at your finances specifically, you would be thinking about ways on how you would handle or change your spending habits or things that you start implementing to save and meet some of your financial goals.

Read on below the seven great ways to save money this coming year to walk you through different saving tips and help you with your financial management;

1. Change Your Mindset

If in the previous year you always felt like you can’t have fun without spending money, then you have to change your mindset. Come up with fun free activities or very low-cost activities to do. There are so many things you can do that don’t cost very much like cheap date nights, free date nights, free stuff with your kids, (if you have kids).

You don’t always need to be spending money to have fun and to go out and do things. Instead of thinking about how you can enjoy now, why not think ahead and consider your future and whatever your goals may be.

Once you have really changed your mindset and you’ve dug deep and figured out that you want to save money, you want to stop unnecessary spending and start saving for your goals.

2. Look For Coupons Online

Before you hit that check out button online, it is recommended to search google or sites like gopromocodes.com, whether there might be any coupons around. Because sometimes, especially for certain holidays, some online stores have specific promo codes like for Christmas, Labor Day, Memorial Day, and the like.

There are coupons available all year round, and you’ll never know if you don’t check. Especially if they have a newsletter, try to sign up and they might even send you some coupons. The saved cash would go a long way considering that you still have taxes and shipping fees to pay in your order online.

3. Cancel Unnecessary Subscriptions

Subscriptions such as your beauty boxes updates, streaming subscriptions, gym subscriptions, and things that interest you are hard to resist. Plus, considering that it is just five dollars a month, that would be easy for you to hit that subscribe button and add your credit card details. That’s plain and easy until it all adds up, and sooner or later, you have all these subscriptions for things you don’t need.

Look at all your finances, start breaking everything down and attend to what subscription you are not using and what does not fit in the money that you have. From that, start unsubscribing from all of those memberships.

It doesn’t mean that you would have to cut out your subscriptions forever, but specifically, if you are trying to pay off debt, things like a beauty box subscription and the likes are not a necessity. Once you are debt-free, you can re-evaluate and see if that subscription that you want can be added in again, given your budget.

4. Save Before You Buy

It is indeed alluring to visit online sites and hit those buy now buttons, but what you want to do if you wanted to save some money is to think about your purchases before you make them. Instead of making a rushed decision in buying, why not plan for it, and save for it in advance.

5. Use Cash

Using cash is a game-changer as far as day to day spending is concerned, for it keeps you on track of your spending. Furthermore, using cash is more emotional, for you will be thinking about the purchase more rather than just stacking everything on your cart and swiping your credit card when you got up the cash register.

6. Have Something To Remind You Of Your Goals

If you are serious about saving money, why not keep something that you really want, or more like a picture of what you’re saving up for in your wallet.

Maybe put it as your lock screen on your phone or have it framed at your bedside. Doing so will always remind you that you are trying to save up for something and probably make you rethink every time you want to buy something that would compromise your saving plans.

7. Pack Your Own Food

Whether at work or school, it is always a good idea to pack your own food. Try to imagine what will happen if you don’t have a packed lunch and you get hungry. If you have some extra cash in your wallet you’re going to spend it on maybe, a vending machine if you are in high school or perhaps you’re going to go and eat out.

Lunch may cost around $8 and imagine if you’re spending $8 every single day even if it’s just for four days it’s going to add up. That money that you are paying for food could have gone through whatever you’re saving for.

Conclusion

If you want to buy something and aren’t able to do so, it makes you frustrated that it continually reminds you to save money. Never let yourself suffer the same frustrations again by taking the seven helpful ways to save money mentioned above, thoughtfully, and stick to it. If followed these ways diligently, you would never have to worry about not having that thing or goal that you have for you are confident that you have the money, you worked hard for it, and had saved for it.

For more great saving money articles read these:

Take the 365 Day Money Challenge

Take the 52 Week Money Challenge

Twenty Money Saving Duct Tape Uses

Image source: Pictures of Money, via Flickr