5 Tips to Begin Saving Money

5 Tips to Begin Saving Money

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When I first discovered that 70% of Americans have less than $1,000 in savings, I scoffed. Then I paused. And then it hit me all-too-hard as I realized that I wasn’t too far off from that number. I maybe only had 3-4x that number in savings.

While I was already above the “average” of 70% of the population, that wasn’t enough to set my fears at ease. I couldn’t help but feel an immense gap between where I was currently and where I wanted to be.

Saving money requires a very conscious, drastic shift in thought. Throughout this process, there have definitely been some bumps along the way. It first began by making excuses as to why I didn’t need to be saving any extra. I then felt inadequate and that I wasn’t making progress quickly enough. Second-guessing my decisions came next.

In all, it hasn’t been an easy ride, but here are five things that have helped me over the past few years to begin saving money.

1. Just Start, no matter how small

There’s a Chinese proverb that says, “The journey of 1,000 miles begins with one step.” It’s so incredibly easy to feel inadequate or intimidated when you look at the mountain sitting right in front of your nose that you’re forced to climb.

How many times have we had an idea, tell friends and family that we’re going to get moving, but then never actually take the first step to doing so? It’s human nature to procrastinate. It’s easier to give up before we even begin. Because money is such a daunting topic, it’s comfortable to simply not do anything — and that’s what many of us do.5-tips-to-start-saving-money

If you’re not a user of Reddit, I highly recommend it. It’s a news aggregation and discussion site — essentially like a web forum, but with almost any subject that you can think of. While there are plenty of time-wasting categories like Cat Pictures, I recommend that you browse sub-reddits (basically sub-categories) of things more beneficial. One of my favorites is Just Start.

Just Start is a sub-reddit that broke off of the Entrepreneur group. There were a number of people who got so fed up with questions and discussions about people who wanted to begin a business, but wouldn’t ever actually do it. Just Start is full of optimistic people who are driven and truly ready to make changes, and it’s a place to document their successes. If you’re looking for motivation, I’d recommend it.

First things first, force yourself to sit down and create a spreadsheet of all your bills, income, and extra spending. Track everything and anything you can think of. It might be a little shocking to see your life down on “paper”. Don’t stop until you’ve completed your list, and everything is accounted for.

Don’t worry about making any mistakes. This is just a rough inventory of where your money is going. As you get going, you can learn as you go. The most important part is that you start moving, and don’t stop.

Now, this is the hard part. Squeeze as much as you possibly can out of your budget. You might be thinking to yourself, “Heh. Right. How on earth am I going to do that? We’re barely making ends meet as it is.” Well, tough. If you want to start saving, you’re going to have to sacrifice. Do as much as you can. You may have to go without coffee twice a week to free up even $25 a month.

2. Make it a habit (and force yourself to do it)

Managing your finances is much more involved than we (myself included) probably believe. It’s more than sitting down once a month to balance your checkbook. There’s more to it than logging into your bank’s website and checking your balance on pay-day.

The day I really committed to saving, I created a weekly alert in my phone. When it would go off, I would force myself to sit down and spend at least an hour working on my finances in some way, shape, or form. Some days, I would balance my accounts and move funds around. Other days, I would read finance blogs or research how to begin investing. The point is, you need to force yourself to make your finances a priority.

If you aren’t able to force yourself to sit down for an hour, make a game out of it, or reward yourself with something. I’ve heard of some couples who have gone out to dinner once a week, and reward themselves for a job well-done. Whatever it takes to make you focus on finances for at least an hour a week, make it happen. I promise you, it’ll be worth your while.

There’s various opinions out there as to how often you should be focusing on your finances. Personally, I focus on them daily, but it helps that I now have an interest in personal finance, so it’s no longer a chore.

One thing I would caution you against is checking your finances too often, however. It’s easy to get in the habit of impulse buying or selling when you’re constantly focusing on the numbers. When it comes to investing, I’ve learned that I generally do better when I focus on the long-term gains. If I’m checking my account balances every other day, or even daily, I find myself buying too frequently, or selling too soon, missing out on potential growth had I just stayed put.

3. Use software to track your spending

Once you’ve gotten a handle on putting away even a small amount of money, and you’re actively “on top” of your finances, I’d sign up for a budget or money-tracking tool. I’m a big fan of Personal Capital, as well as Every Dollar. They’ll automatically track your spending for you, show you graphs and other information on where you spend the majority of your money. It’s one thing to have a budget down on paper, but another to see where money is actually bleeding you dry.

Additionally, these tools can help you with your savings goal. They’ll have you create a target goal, ask you how much you can contribute each month, and then giving you encouragement along the way as you get closer and closer to completing that goal.

4. Keep saving — It starts slow, but really adds up

Once you understand where your money is going, and how much you can devote to savings, even still it’s easy to get discouraged. When you see how little you have, and where exactly you want to be, it’s a mind-game to force yourself to continue saving. A piddly $25/month doesn’t seem like much. And to be fair, it’s not. Stepping up and saving even $100/month will vastly increase your savings rate.

It begins slow the first few months, but I surprised myself by how quickly my savings had grown after 6 months. One year in, I couldn’t believe that I had saved that much. After one year of consistent savings, I had almost tripled the amount of money that I had started with, and was that much closer to reaching my savings goal.

Everyone has this profound desire to grow rich overnight, but as well all know, it doesn’t work out that way. The biggest tip that I can provide is to simply keep saving, stay your course, and don’t give up, even when you want to. There were absolutely days where I wanted to break, but I kept saving. I knew that if I were to continue, it would be so much more worth it in the end.

One of the biggest motivators for myself was to place a sticky note on my bathroom mirror, showing my balance when I began saving money, rather than my goal balance. As humans, it’s easier for us to look back and see how far we’ve come than it is for us to look forward and where we could be in the future. This gave me the motivation that I needed to not give up. I was proud of myself. I was proud of how far I had come. And nothing was going to prevent me from continuing on.

5. Curb Your Spending Habits

You’ve done it! You’ve made it! You’re on the correct path now to saving. But one of the biggest opposers to saving is spending. You could be the greatest saver in the world, but if you don’t have your spending in control, you can easily deplete it in a single day.

Prioritize what you need, and only what you need. And sometimes, you may even have to forego things that you truly do need for a greater reward in the end. At one point during my savings process, I had a problem with my pickup. It was an older vehicle, and it had a fairly serious power steering fluid leak. So much in fact, that it was leaking close to have a quart per day. A mechanic had quoted me $800 to fix the issue. I was tempted to immediately withdraw the money from my savings and just get it fixed. But I was driven, and didn’t want to kill the momentum that I had worked so hard to gain.

So for three months, I continued buying power steering fluid, and topping it off every couple days. Sure, a bottle of fluid cost me $4, but I could purchase a lot of fluid for $800.

I did in fact get the truck fixed eventually, but it wasn’t my highest priority at that time. Curve your spending habits and make sacrifices to ensure that you stay on track.


My journey up until that point, and even to this day, had been an incredible learning experience for me. While I often felt the urge to give up (I felt it more often than I care to share), the last few years have proved to me what consistency and self-control can actually accomplish. While personal finance is now one of my hobbies, I never went to school for business or finance. It just goes to show that if I can get my financial life in order, you can too.

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