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Be Wise With Money
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4 Steps to Save More Money
June 9, 2016
How to reach your savings goals
You know you need to save – for retirement, to have emergency savings, maybe for a big purchase like a house. But how do you find money, especially if it's already tight?
It's all about making intentional choices guided by your faith-based values. The key is knowing where your money is going and having a plan for how and when it will be used.
Here are four steps to take that can help you create a plan to save more money.
1. Write down everything you spend.
Keep track of where all your money is going for a couple of months. You want a clear picture of your spending habits, so be honest with yourself and don't judge. Check out this budgeting system called BalanceWorksTM to help you manage your money.
2. Create an emergency savings goal.
Not sure where to start? If you don't have emergency savings for the unexpected, start there. If you're trying to get out of debt, focus on that as your goal. Write down your goals, making them SMART goals: Specific, Measurable, Achievable, Results-based and Timed. If you make them broad or vague, it's hard to see the end or the path to get there. Start with a small, short-term goal first; it will take patience and practice to get there.
3. Stop, think & choose before you spend.
Be aware of purchases that don't help you achieve your goal. Ask yourself these simple questions before you make that impulse buy:
- Stop: Will this help me reach my goal?
- Think: Do I need it? How many hours do I have to work to pay for it?
- Choose: Will you buy, wait or skip altogether?Give yourself a monthly spending allowance to allow for some pleasures in life and to create balance.
4. Money in = money out.
In other words, the goal is balanced spending. Use this budgeting worksheet to help you determine how to use your money: how to share, save and spend. The goal is to have your money in be equal to your money out.
A tip to get started: Try using only cash for one week. By not using credit cards, you may find you have a different perspective on how you spend your money. And, since you won't rack up any interest rates like you could with a credit card, it may be easier to achieve those balanced spending goals. Try your hand at the Cash Challenge!
Would you like more information about how to actively manage your money? If so, connect with a financial representative or attend an educational workshop from Thrivent Financial where you can learn more.
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