How to Save Money When You’re Young and Broke

I’ve never been good with saving money. This is most likely because I have a “money comes and goes” attitude in order to justify my spending habits.

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This mentality hasn’t gotten me very far, seeing as how I currently live from paycheck to paycheck and have no adequate savings for emergencies.

Today, I had the opportunity to talk to a financial advisor and receive free advice on how to plan for the future. The plan I created was unique to my spending habits and what financial goals I had for myself (the main one being to save money). Overall, it was extremely helpful so I thought I would share a few of the tips I received.  The very first thing my advisor told me to do was:

Create a budget 

We made a list of all my bills and expenses and were able to determine how much money I could put away each paycheck to create a savings. When we created my budget, we agreed to treat my savings as if it were a bill. That way, having an exact amount I was required to put aside each paycheck would get me into the habit of putting money away for the future.

Create a separate savings account 

After creating a budget and a designated amount to save each month, he suggested I create a separate savings account. Both my checking and savings accounts are connected, so when I run out of one, the other is right there to back it up. This was one of the major reasons I was having trouble saving. My advisor suggested getting a separate savings account so that I don’t immediately turn to it unless it’s an absolute emergency.

Find ways to increase your income 

I’m working part-time right now, which makes it difficult to budget and save. If I found a way to increase my income (by applying for full-time work or picking up side jobs), I could live under the same budget and lifestyle while saving more money.

Use your credit more and pay it down quickly 

Prior to taking out student loans and credit cards, I never took the time to understand how credit and debt actually worked. Using your credit and paying off the balances in a timely manner brings your credit score up, while keeping large balances and paying them off slowly can hurt you. So, be sure to swipe wisely and pay off as much as you can as soon as you’re able to.

Although these tips helped me establish a plan to get to where I want to financially, I’d be lying if I said it won’t be hard to change my money habits. It’s going to take a lot of dedication, discipline and saying no to brunch and dinner every now and then. But, Like all things that are difficult, it’s important to keep the end goal in mind, which is ultimately developing financial stability for the future.

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