Not everyone is saving enough. A Huffington Post article cited a study by financial services trade association LIMRA that said that one in two Americans are not saving for retirement. Saving for retirement is just one of the aspects of saving and it will be hard to start saving money if people maintain habits that hinder them from being more financially responsible. Let’s look at ten habits you should break to help you save money.
Not Making a Budget and Sticking to It
Making a budget is one of the most important things to do to help you save more money. However, writing down a budget is different from following through and sticking to it. Keep within your budget and you’ll reap the benefits of having greater financial security.
Not Keeping Track of Your Income
It’s hard to save money if you don’t know if you’re making enough to take care of the bills. Take a moment to study your income and compare it with your expenses. This will help you know if you have enough left over to put away as savings.
Not Maximising Your Contribution to Your 401K Plan
401K plans are tax-deferred defined-contribution pension accounts. When your employer matches your contribution to the plan, you should try to contribute as much as your employer will match so you can boost your savings. Contributing less than that means you’re losing out on your benefits.
Not Keeping Track of Your Spending
A candy bar here, a newspaper there, tips for lunch, small expenses like these add up and you’re not helping yourself save by buying stuff even if these only cost very little. You might have also applied to auto-bill payment services and have neglected to dispute charges that shouldn’t have been made to your account in the first place. You could be wasting a lot of money you could be using for something else so take the time to review your bills. If you want to keep track of your daily spending, download one of the many apps available for your smartphone that lets you input your expenses and shows you a graph of where your money is being spent on.
Forgetting to Switch Off Appliances
Not switching off appliances like TVs and electric fans when no one is in the room is a waste. Switch these off and save on your electric bill. Some people also tend not to shut down their computers because they don’t want to be hassled by the long startup time. Tablets and smartphones these days are always on anyway and are useful for looking up info on the net quickly so you can turn to these devices instead of always keeping your PC on.
Failing to Do Your Research on Interest Rates of Deposit Accounts
If your account is not earning the most interest, then you’re not maximising your savings. Compare the interest rates of the many deposit accounts being offered by banks. If you have enough funds above what you would need to withdraw immediately, consider opening a time deposit account. Time deposit accounts typically earn more interest than a regular savings account—except you can’t withdraw money as easily compared with the regular savings account.
Letting Credit Card Rewards Expire
You’ve made several purchases on your card already and you’ve accumulated reward points. Don’t let these reward points expire and apply these points to your next purchase, if possible. Some cards will also let you convert these points to air miles so you can use them for a vacation or business trip.
Being too Shy to Haggle
There are some situations where it’s OK to haggle. Buying from flea markets and sellers who post on online classified ads are just some of the situations where you should practice your haggling skills.
Letting Food Expire
If you find that food in your pantry or ref are expired, that’s a sign that you’re buying too much food. You’re wasting money this way so buy less food.
Paying Fees for Using an ATM from Another Network
The fees you pay using an ATM from another bank network is an unnecessary expense at a time when there are ATMs almost everywhere. Make sure you’re using the ATM of your bank to avoid these fees. Or, you could also go with a bank that has a wide ATM network so it’s easier for you to access your money.
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This article is prepared by Money Hero for Zwdia.biz. Money Hero is Hong Kong’s up and coming financial comparison website. You can compare a wide range of financial products, from credit cards to insurance plans.