How to Find the Money:
- Find Ways to Trim Your Budget
When you calculated your monthly budget, you may have noticed some frivolous or unnecessary expenses. These can include eating out instead of making meals at home, buying the new "greatest hits" collection from your favorite band or paying for premium gasoline when your car's owner's manual says unleaded is just fine. Don't deprive yourself: just identify a few small lifestyle changes that might free up between $50 and $100 a month that can be put toward savings. - Turn Yourself Into a Creditor
If credit card bills are one of your big expenses, draw up a plan to pay your creditors off. As you pay off the balance on each charge or credit card, save the money you're no longer handing over to credit card companies. Write a check each month for the same amount to your emergency savings account. - Use Direct Deposit
It's hard to spend money you never see. That's the beauty of direct deposit programs. Instead of depositing your entire paycheck into your checking account, specify a fixed amount to be paid into your savings account. - Make Special Occasions Count
When you receive a work bonus or an unexpected tax refund, your first instinct might be to reward yourself. Instead of spending that money on a new wardrobe or a big screen television, put it into savings. Even if you can't stand to deposit the entire amount, earmark at least half of your windfall for your emergency fund. - Use Your Raise Wisely
Go ahead and celebrate your accomplishment with a nice dinner or other treat; consider diverting the rest of your raise money to your savings account. Continue to spend like you had never gotten the raise, and you may be amazed by how quickly your savings will grow!
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