How to start saving money in 2018?

How to start saving money in 2018?

Do you spend more money than you earn? You should make a big decision to start saving money in 2018. I wrote some useful tips to help you develop savings habits. Some of them you can implement now. Don’t expect that your financial life will change immediately. It takes time but if you are persistent you will succeed.

Frugal living tips

  • First of all, you need to pay off your debts if you want financial freedom. Get rid of your credit card debts, student loans or other debts as soon as possible.
  • Create a budget list and cut your costs. You can start creating it at the beginning of the year. Plan your savings for each month, but be realistic. If you spend $2000 per month, you can’t expect to save $1500 per month. Use finance applications to keep track of your expenses. When you start tracking your expenses, you might be surprised how much money you spend on small items. You need to know where you spend much money so your budget will work.
  • You should plan savings for your future. Open savings accounts such as investment fund, emergency fund, retirement fund. Don’t mix money, keep your accounts separately. If you want to save money, automating will help you.
  • If you have a bank account that charges you high monthly fees, switch it. Open an account that will help you earn interest on money.

Cost savings

  • Avoid unnecessary costs such as cable bill. You can use streaming services instead of cable.
  • Reduce mobile phone expenses. Maybe you have applications or services you don’t need any more.
  • Cancel gym membership or other activities you pay for. For example, you can watch YouTube videos about fitness, and do your exercises.
  • Save money on electricity bill. Turn off the lights when you are leaving your house. Instead of traditional bulbs, you can use LED bulbs. You can also turn off the television and spend your time with the family. Visit your friends.

Save money each month

  • You can start saving small amounts each day. If you save only $5 a day, it is $150 per month and $1800 per year.
  • Develop your savings plan for each month. Write down on the paper how much money you want to save. If you write your savings plan, you can take it more seriously and you will start saving money.
  • You can negotiate a better rate for services you use every month. A company might offer you good deals if you are its customer for a long time. You can also negotiate a better price for other things you want to buy. You can cut your credit card debts if you negotiate with the company. If you like to use your credit card to buy things, leave it at home.
  • If you live in an expensive apartment, find a cheaper place to live. Apartments are usually expensive, but it is not impossible to find the cheap one.

How to start saving money in 2018?

Save money on food

  • We spend much money on food that we don’t really need. Writing a shopping list and menu plan are good ways to save money on food. When you go shopping, you should avoid impulsive buying. Bring a shopping list and stick to it.
  • Use coupons and buy food on sale. You should go to the stores and see what’s on sale before you create your meal plan.
  • We have a habit to buy food at the same store, but maybe that store is not cheap. Find another one. You can also go to the markets because you can find cheaper food there.
  • You can save much money if you don’t buy sweets and snacks. Avoid this unhealthy food. Instead of sweets, you can eat fruits. This is a good way to lose weight.
  • Make your lunch at home and bring it to your work. Don’t spend money on sandwiches, hamburgers or drinks. It is cheaper to make a sandwich at home. If you are trusty, you don’t need to buy expensive drinks, drink water.
  • Don’t eat at the restaurants because they are expensive. Eat at your home. Avoid expensive fast food, too. If you like hamburgers, you can make them at home.

The most difficult part about building savings habit is to start saving money. I hope my tips were useful for you. You can also find more money saving tips on https://www.moneyjojo.com/saving-money/.

When you see how much money you saved per month, you will keep yourself motivated, and you will achieve financial success.

How much money do I need to retire?

How much money do I need to retire?

We spent many years working hard and saving money for the retirement. Our retirement can be a happy part of our lives if we save enough money. You should imagine yourself at 65 years, and estimate how much money you need for the retirement.

Retirement quotes

Before getting into details I’m sharing some quotes on retirement that I found recently. I hope they will inspire you.

  • “As in all successful ventures, the foundation of a good retirement is planning.” – Earl Nightingale
  • “The question isn’t at what age I want to retire, it’s at what income.” – George Foreman
  • “Retire from work, but not from life.” – M.K. Soni
  • “Planning to retire? Before you do, find your hidden passion. Do the thing that you have always wanted to do.” – Catherine Pulsifer
  • “Often when you think you’re at the end of something, you’re at the beginning of something else.” – Fred Rogers
  • “Retirement is not the end of the road. It is the beginning of the open highway.” – Unknown
  • “The trouble with retirement is that you never get a day off.” – Abe Lemons
  • “Retirement is wonderful if you have two essentials — much to live on and much to live for.” – Unknown

How much should I put into retirement?

Generally, you need to save 10% to 15% of your income for the retirement. It is the best to start saving in your 20s. If you want to plan how much money to put into retirement, you need to know how much money you spend each month. How will you spend your money when you retire? Maybe you will travel or find some interesting hobbies.

You should count your potential monthly expenses for the retirement. Use a retirement calculator to see how your savings process works, how much money you need to accumulate and save. Don’t forget to calculate your retirement needs regularly. Life is unpredictable. Maybe you will find a new job or a new place for living.

Saving for retirement at 30

If you have 30, it is the right time to start saving money and make a plan for the future needs. According to researchers, if you start saving at 30, you need to save 12 % of your income for the retirement. If you can’t put 12% of your income now, you can slowly increase the money you save. Set up your savings goal and you will know how much money to set aside. You can invest in a tax-deferred retirement account – 401(k) plan.

Maybe you have debts (student loans, credit cards, etc.) you need to get rid of. It doesn’t have to be your priority. How much is the interest rate on your debt? If the interest rate is better for retirement investments, you should choose to save for retirement. Paying a debt with low-interest rate first is not a good idea. You should ask for raise of the salary. When you start earning more money, you can pay off your debts.

Automate your money using investment platforms (various money applications). Automating will help you save money.

Qualified retirement plan

Qualified retirement plan

A qualified retirement plan is created by one employer who wanted that the employees benefit from it. This plan meets the requirements of IRC Section 401 (a).

There are two types of this plan:

  • defined benefit- pension plan in which employer or sponsor gives a payment based on your salary and years of working for the company
  • defined contribution – 401(k) or 403(b) are defined contribution plans in which you decide how much money you will contribute and your employer will put that amount into your account.

Here are other qualified retirement plans:

  • ESOP plans
  • HR-10
  • SEP
  • SIMPLE
  • IRS
  • 403(b) plans
  • 457 plans

How much will I have when I retire?

The most important step is to create your retirement plan. Use a retirement calculator to calculate how much money you will have for the retirement. Type data about savings:

  • current age
  • current savings balance
  • annual savings amount
  • annual savings increase.

Then type data about assumptions:

  • age when income should start
  • number of years to receive income
  • before-tax return on savings (%)
  • marginal tax bracket (%)

Don’t forget to save money regularly and check your savings process!

You need to start saving money for retirement as soon as possible, and retiring can be the best part of your life. When you retire, you won’t worry how to make money anymore. You will be happy, rich and relaxed.