With the prices of everyday items increasing in the last little while due to the stubborn inflation figures, saving money has been a challenge for many.
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However, despite rising costs and higher interest rates, we shouldn’t give up on our financial goals. It’s still possible to make saving money a priority.
According to a recent survey of over 1,000 Americans conducted by GOBankingRates, 22% wanted to save $10,000 or more in the next year. Men were more hopeful of hitting that amount — 28% vs. 18% of women who wanted to save $10,000. Millennials and older Gen Zers were more likely to target five figures in savings — about 25% of the 25-34 age group and 26% of the 35-44 set.
The good news about these results is that you can reach this savings goal if you start taking action immediately. We spoke with Andrea Woroch, a family finance expert, author and regular TV contributor, about how to save $10,000 or more in the next year.
Cut Your Monthly Expenses
“Many people look at their monthly bills as necessities and those that are set in stone, overlooking the many opportunities there are to save,” Woroch said. “Spend time reviewing your monthly expenses, list out what you pay, and then start hacking.”
The best way to save money is to optimize your current spending to ensure you’re not still paying for services you no longer use or get much value from. You may be surprised by how many expenses you forgot about on autopay.
Woroch shared some practical tips on how you can cut your monthly expenses: “Call providers to negotiate, ask about bundling services for savings, compare rates with competitors and switch if you get a better deal, remove any extra add-on if you don’t use it, cancel unused subscriptions, reduce your data plan based on your actual usage (chances are you don’t need unlimited data) and so forth.”
Everything can be negotiated, so it makes sense to take some time to see whether you can bring down any of your fixed expenses. You never know what kind of discount is available until you ask.
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Transfer Your Credit Card Balance
“If credit card payments are eating up your income, take time now to consolidate to save on interest and get out of debt for good, ” Woroch said. “Transfer your credit card debt to a 0% balance transfer card, which will waive interest fees on the balance for anywhere from 12 to 21 months, depending on the card offer, helping you save a lot in interest. This way, you get out of debt faster and can put more of your money towards savings and retirement.”
You can use GOBankingRates to find the right balance transfer credit card. When you bring down your interest rate, you’re saving on your monthly payments, and you’ll be able to pay down your credit card debt more quickly.
You also can contact your current credit card company to see whether you can get a reduced rate based on your history with it. A LendingTree study found that 76% of those who requested credit card rate reductions were granted them. A few phone calls can save you a decent amount of money.
Get a Side Hustle
“No matter how much you cut back on bills and daily purchases, you’re only going to be able to save so much, especially if you have high housing and debt payments,” Woroch said. “Taking on a side hustle to earn extra cash is the fastest, surefire way to bolster your savings and put away $10,000. Plus, there are so many options that you can do from home and in your spare time when it’s convenient for you that it’s a no-brainer way to improve your finances.”
You’ll want to explore different options for increasing your income so that you can put more money aside into your savings. There are constantly new side hustle opportunities, and there’s likely one idea that could fit your lifestyle.
Here are some examples of side hustles that Woroch recommends to boost your income: “You can find virtual tutoring opportunities that pay $20 to $50 per hour via Tutors.com or make up to $1,000 monthly by pet sitting via Rover. Other ideas include renting items you don’t need or use — you can rent a spare bedroom via Airbnb, a car when it’s not in use via Turo or baby gear via Baby Quip.”
As you can see, there are various opportunities to increase your income so that you get serious about reaching your savings goals. With the combination of reducing your fixed expenses as you increase your income, you’ll see your savings account grow faster than ever.
Limit How Much You Spend on Food
“You want to think about how to cut dining out and reduce food waste because Americans waste around $1,500 worth of groceries each year,” Woroch said. “Planning out meals is crucial to reduce your overall grocery and food spend and limit food waste. Meal planning ensures you only buy the groceries you will cook and eat instead of buying food on impulse that ends up getting wasted.”
With the popularity of food delivery apps, many people started relying on these services for convenience. It’s essential to remember that convenience comes with a price. If you want to save significant money, you’ll have to pay attention to how much you spend on your meals and make some sacrifices.
“When you have ingredients for a meal that is easy to cook at home, you will be less tempted to order takeout,” Woroch said. “Food is a huge expense, and finding ways to trim back on how much you spend on take out and dining out can help you save more.”
Use a Cash-Back App
“Download a free cash-back app like Fetch.com to earn points for taking pictures of your grocery receipts, which are good towards free gift cards to stores like Target, Amazon and Walmart to offset future grocery shopping needs,” Woroch suggested. “Let points build up and cash out when you need the extra help in your budget so you don’t sacrifice your savings or take on debt to pay for a purchase.”
There are many cash-back apps and services that you can use to help stretch your budget to ensure that you’re always putting money aside.
Find the Right Savings Vehicle for Your Money
“Where you put your savings matters too,” Woroch said. “Make sure you open a high-yield online savings account to take advantage of the high interest rates so your savings earn money to help meet your goal faster.”
You don’t want your funds just sitting around as you’re trying to save $10,000. There are accounts paying over 5% right now, much higher than the national average. This is one easy way to have your money working for you as you’re saving up.
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This article originally appeared on GOBankingRates.com: I’m a Financial Expert: Here’s How You Can Save $10K or More in the Next Year
