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Money is tempting. It’s easy to blow your next paycheck on shopping with your girls, a fancy dinner, that shiny watch you’ve had your eye on, or a brand-new phone even though you really don’t need it. But, it’s also important to think about your savings, emergency fund, and retirement. The last thing you want is to be entering your golden years realizing you only have enough money to get you through a few years. Instead, take a proactive approach with these five safe money habits for getting your finances in shape.
1. Automatically Transfer Money into Savings
This habit is an easy one. All you have to do is go to your bank account and set up auto-transfer and set a specific amount you’d like transferred each week. So, if you have a goal to save $1,500 in the next 5 months, auto transfer $75 each week. The best part about this is that it’s automatic, so you won’t have to remember to set aside money or be tempted to not transfer money at all. With auto-transfer, you’ll be able to save money so you can afford your next vacation, that luxury car, or increase your retirement fund.
2. Stay Alert
There are hundreds of scams floating around on the internet, through phones, and even through the mail. Do you really think a Nigerian prince is going to transfer $6.5 million in your bank account to keep safe from the Nigerian government and give you 30 percent for helping him out? We sure hope not. Or, did you get a fake IRS letter scam that asks for your personal information such as your bank account number and Social Security Number? Ignore it.
Government agencies will never contact you by email, so if you receive one, report it immediately. Nor will the IRS ever ask for information like your bank account number. If it looks suspicious, it probably is, so always stay alert.
3. Make a Budget
Creating a budget when planning a big purchase will ensure you prioritize your spending. Whether your goal is to get out of debt or to go on a family vacation, creating a budget will ensure you don’t spend frivolously on unnecessary items. There are numerous budgeting apps on the market that sets aside money for you, track bills, and looks at your transactions. Creating a budget will allow you to plan out your financial future by determining which months you may be strapped for cash, and which months you’ll have a little extra spending money.
4. Don’t Spend Where You Don’t Have To
This tip is hard, even for us, but not spending money where you don’t have to can save you hundreds, even thousands of dollars a year. Maybe try brewing coffee at home instead of heading to Starbucks and spending $5 on a triple, venti, half-sweet, non-fat, caramel macchiato with an extra shot and two pumps of syrup. Or, instead of going out to lunch every day at work, bring a lunchbox and pack your own meal.
Trying to cut back spending in every area of your life can make you feel deprived. Instead, focus on one single area that you know you spend extra on and try cutting back. So, if you’re all about hitting the clubs up on the weekend, try offsetting your weekend spending by either having a few drinks at home before you go out to save on overpriced drinks, or meal prep to cut back on dinner costs.
5. Make a List of Purchases You Need
As we all know, it’s never a good idea to go to the grocery store on an empty stomach. Doing so will cause us to buy pretty much everything in sight. I’ve definitely been guilty of this!
Instead, make a grocery list so you know exactly what you need, and nothing else. Many stores work in a way to entice you to buy more product with strategically placed sales signs, aisles in the form a maze, and other sneaky tactics. By creating a shopping list, you’ll be able to track your purchases and control your spending so you can save more money.
Forming safe money habits isn’t as tough as it may seem. While it’s nice to treat ourselves to nice clothes, fancy dinners, and fun experiences, doing it on the regular can set you back financially. Instead, forming a budget, planning your purchases, staying aware of scams, and saving money, will set you up for a bright future.
About Money & Mimosas: Money & Mimosas was started as a passion project by Danetha, a former NFL cheerleader and CFO. After a brunch conversation with girlfriends, Danetha was inspired to launch a resource to learn how they could all enjoy life while being smart with their money. Because who doesn’t want to have their money and mimosas, too?