If you've ever checked your bank balance at the end of the month and wondered “where did all my money go?” you're not alone.
In fact, a 2016 survey revealed that nearly 60 per cent of the population doesn't have enough money saved to handle an unexpected expense of $500 to $1,000.
That means something like new brake pads, a sudden hospital visit, or even something like a year-end class trip for your son or daughter are beyond your spending reach despite how much you need — or want — to pay for them.
So what happens in cases of extreme emergencies?
Of those who lack sufficient money in their savings, most will cover necessary costs by using a credit card, borrowing against an IRA or 401(k), or turning to family and friends for financial assistance. A much smaller number say they would get the money they need by reducing their spending.
This financial pressure is taking its toll on consumers, many of whom already are feeling worried about making ends meet.
The American Psychological Association — in its 2014 study “Stress in America: Are Teens Adopting Adults' Stress Habits?” — cites money as the most commonly mentioned burden for adult Americans, with more than 71 per cent reporting at least some degree of financial stress.
It's this stress that leads to poor health and marriage difficulties.
Save More, Stress Less
No one wants to live their life burdened by the lack of money, which is why learning to save money is so important.
What ultimately relieves money-related stress is getting past the paycheck-to-paycheck treadmill — that sense that you're running as fast as you can without ever getting ahead.
That's why it's so important to have saving strategies for different goals in your life.
Not only will it allow you save for unplanned expenditures, but it will also reduce the stress that comes from spending beyond your means.
What you accomplish when saving money is more important than the purchase of any large-ticket item.
“It's peace of mind that you'll be able to achieve the goals you're saving for,” says Deacon Hayes, founder of the financial advice website, The Well Kept Wallet.
We spoke with three real people — including Hayes — who became experts at saving only after they accomplished at least one or more of these things:
We took their lessons and combed the digital earth for more.
We came up with 17 money-saving strategies that will help you curb expenses, save toward goals, build your bank account, and achieve a better relationship with money—helping you live happier, more stress-free life.
Savings plans that actually work?
Take a look....
Think Like a Saver
Because — life happens, and unfortunately, things like, say, paying rent when you're suddenly laid off or covering the cost of an unexpected root canal do not come with promo codes.
Sadly, just one jolt to your monthly expenses can be the difference between moving back in with your parents — probably destroying your credit score — or, well, having your tooth fixed and a roof over your head.
And even though 66 million U.S. adults have zero dollars saved for an emergency, that doesn't mean you should be one of them.
Setting aside money for emergencies or just, in general, will serve you well, affirms, a chief financial analyst of Bankrate Greg McBride. “If you are not in the habit of saving regularly, whatever you have is going to get wiped out sooner rather than later.”
How big should your emergency fund be?
Bloggers at One Cent at a Time advise you to save a minimum of $1,000 before saving for anything else.
They concur with other financial experts, cited by Bankrate, who recommend accumulating a fund equivalent to three- to six-months of living expenses.
Why do you need an emergency fund
America Saves reports that low-income families with at least $500 in their emergency funds were better off financially than moderate-income families who saved less for emergencies.
With an emergency fund, you are less likely to use costly alternatives like high-interest credit cards or payday lenders.
Keep the fund separate from your regular savings account
“I recommend people put their emergency savings fund in a different savings account that is not directly attached to their bank, such as an online savings account or a bank across town,” says Lauren Greutman, nationally recognized money expert and author of “The Recovering Spender.”
“That way, when something happens, you'll have the extra money and it won't push you back a couple of months.”
The Consumer Federation of America reports that those who have a savings plan are twice as likely to be successful savers as those who do not.
Why is that?
Well, a plan is like a map. If you don't know where you need to go, then it's very likely that you'll get lost or stalled.
Setting a goal and making a plan to achieve that goal is essential to being a successful saver.
Note before you begin: Don't forget Rule No. 1! Make sure your first savings goal is an emergency fund!
Once you have an emergency fund, you can set up fun goals like saving for a vacation or Christmas presents.
Here's how:
The Countdown Method
This is a favorite strategy of Hayes, which involves putting a specific sum of money in a savings account every month. “Basically, it's figuring how much you want to save and working backward until you achieve your goal,” Hayes explains.
Let's say you're planning a trip to New York that will cost $500 and you have 10 months to save it.
Your goal is to save $50 a month, whittling the money you need from $500 to $450 to $400—all the way down to zero. “At the end of 10 months, you'll have enough money to get where you want to go,” says Hayes.
Easier said than done, right? Nope! Wrong.
Jeremy Vohwinkle at the consumer finance site, The Balance, sums up how to clearly set up auto deposits to your savings account:
Thanks to modern technology, it is very easy to set up an automatic savings plan.
First, you need a savings account. Open one at a bank where you have your checking account if you don't already have one set up, and make certain your checking and savings accounts are linked.
If you currently have direct deposit through your employer, you will find the easiest (and most effective) way to establish your automatic savings program is to have part of your paycheque directly deposited into your savings account (the rest, as usual, will flow to your checking account to cover your bills).
It doesn't matter if it is $10 or $500 — simply setting this up automatically will ensure you save money every single time you are paid.
Jeremy also points out that you can still set up an auto transfer with your bank even if your employer doesn't do direct deposit.
If you don't have direct deposit, there is still an easy option available: set up an automatic transfer from your checking account to your savings account every time you're paid.
For example, if you're paid every other Friday, you could establish an automatic transfer of a set amount of money from checking to savings to coincide with this deposit.
He adds one last important point:
Just make sure you're aware of when the money will be deducted each month, or you may find yourself overdrawn.
The Mason Jar Method, or the “52-Week Method”
As Hayes explains it, you start by putting a single dollar in a mason jar.
The next week, you put in $2, and the following week, you put in $3.
Continue by adding an additional dollar each week.
“By the end of the year, you'll have $1,378 to spend on Christmas or vacation — whatever you want to save for,” says Hayes.
Categorize your goals
The Millennial Budget website suggests categorizing goals as short-term (one year or less), medium-term (one to three years) and long-term (three-plus years).
A short-term goal might be saving for a vacation, whereas saving for retirement is a long-term goal.
In the middle, you might be saving to pay for your wedding or a new car.
Use different saving strategies for different goals:
For instance, if you charge a $2,000 vacation on a credit card with 15% APR and make only the minimum payments required, you'll pay more than the original amount — $2,517.67 — in interest alone.
That's two vacations!
If ever you needed further convincing to pay off your debt with a real plan, there it is.
Here are some methods for eliminating your debt:
The Snowball Method
Hayes eliminated his own debt of $52,000 in just 18 months, an experience that inspired him to found The Well Kept Wallet.
One of the best ways he has found to eliminating debt is the Snowball Method, in which you pay off your outstanding balances, from smallest to largest.
This gives you a sense of achievement, motivating you to eliminate larger balances until your debts are paid off.
Here's how Hayes explains it:
The idea is that if you take any extra money, you have to pay down the smallest debt, and you will have victories early on that will help you pay off your debt even faster.
After you pay off the first debt, then you take the money you were paying on that debt and roll it into the next smallest debt.
Do the math
On his website, Hayes provides a Debt Snowball Worksheet, which will easily allow you to determine how much you owe and how fast you can get out of debt by adjusting your payments.
For instance, if you owe $50 on a Visa card and $100 on a Discover card, then first pay off the Visa.
Once you've paid off that Visa, you take the money that was once going there and move it over to pay off the Discover card.
In three months, you're debt free!
Ditch high-interest rates
Interest rates are savings-killers, so use our Cost-of-Debt Calculator to keep on top of how much you're spending in that area. It all comes down to being smart with credit cards.
Pay them off each month, or shop around for a credit card that gives you zero or low interest, as well as one that pays you back with generous reward programs.
Or, if you're currently overwhelmed with debt, take steps now to seize ultimate control of your personal finances.
Greutman came by her book title, “The Recovering Spender” from personal experience.
Her out-of-control spending habits caused her and her husband to sink $40,000 into debt.
“I finally decided enough was enough,” she says. “I had to change, I had to set boundaries, and learn how to save money.”
With the knowledge gained from personal experience, she now passes this advice on to others:
Identify financial weak spots
This is something that Greutman teaches in her online course, Financial Renovation.
“Typically I tell people to look over their past three months of spending and identify areas where they overspend the most. Those are your financial weak spots.”
You can identify your weak spots by looking closely at your bank or credit card statements for spending patterns.
Some examples of weak spots:
Alter your habits
Set savings boundaries based on these weak spots.
For instance, in Greutman's case, she avoids going into Target alone and no longer attends at-home parties like Mary Kay or Pampered Chef.
“Those are the places where I know I have a problem with overspending, so that's where I've set my boundaries.”
Use savings to pay off debt
By setting up spending boundaries, Greutman was able to make great headway on her debt.
Within two years, she and her husband had paid off their credit cards, and two years later, they had put their student loans and car payment behind them as well.
Budgets aren't just for companies and businesses.
They work (very well) for households, too.
Without one, you're virtually flying financially blind when it comes to how much you're spending and saving. They don't let blind people fly planes, for a good reason.
They crash and burn.
Take the lead from Apple, IBM, and other huge and successful companies and create a simple one for yourself.
Because it's designed to give you dollars-and-change clarity, it'll keep you on track to building up your savings.
Once you have a budget, then what?
Target every expenditure
When Greutman and her husband were strategizing to pay off debt, they cut back on virtually every expenditure.
“We canceled cable, got rid of our house phone, stopped eating out, and cut our grocery bill from $1,000 a month down to $200," she reports.
“I learned to make extra cash by selling things online, and every single penny we had went to paying off debt."
Consider the 50/20/30 rule
This is a popular budgeting strategy that divvies up your resources, with 50 percent going to essentials—i.e., housing, utilities, food, and transportation; 20 percent to savings; and 30 percent to personal expenditures like clothing and entertainment.
Target cuts in personal expenditures, but also trim the “essentials" category by shopping smart for groceries, taking public transportation, and using other saving strategies presented in this article.
Stay on a budget
Setting a budget is one thing, but staying on budget is another. Get everyone in your family to commit to meeting your goals.
The website How Stuff Works (Money) recommends that you monitor receipts, purchases, and expenditures. Make adjustments to fit reality, but be diligent about keeping to your overall plan.
Cut Spending
It's a psychological fact that many of us spend more when we use plastic.
Indeed, the Journal of Experimental Psychology found that — as researchers, Priya Raghubir and Joydeep Srivastava put it — “credit cards dulls the 'pain of paying.”
The proof is in the (Thanksgiving) pudding, cites an article in Psychology Today:
"In one study, the authors found that participants were willing to spend $175 to throw a Thanksgiving party when using a credit card to buy the food, but only $145 when using cash.
Greutman recommends using cash, especially in those areas where you typically overspend.
“It helps you be more accountable to the actual budget and stick to it."
Here are specific ideas from Greutman on how to make a cash-centric strategy work
Put limits on what you spend
For instance, if you typically overspend on clothing, give yourself a clothing budget—in cash.
“Don't continue to use your debit card because you're not going to stick to it," Greutman advises.
“Put the cash in a specific place like an envelope or wallet compartment.
Keep track of it and use it, and realize when it's out, it's out."
Give yourself some "play money"
Sticking to a budget can be tough, which is why a lot of people break down and overspend.
Compare it to someone who goes on a strict diet, then cheats by downing a half-gallon of ice cream.
Allocating some limited discretionary cash gives you a controllable outlet for your spending urges.
“It can be $10 or $50 that you can use for whatever you want—whether it's a cup of coffee or a new blouse," Greutman says.
Avoid binges
Having some extra money gives joy to people who might get depressed at the thought of having no discretionary cash.
“By giving them a bit of wiggle room, it helps people save money in the long run because they're not going to go out and binge on a big purchase," Greutman explains.
Food is the third-largest household expense (behind housing and transportation), so targeting your your grocery budget for savings can have a substantial impact.
As one of the largest monthly household expenditures — comprising nearly 13 percent of total yearly expenses—groceries can be targeted for significant savings.
“Usually I can get people a 50% savings on their groceries just by using a few simple strategies," says Greutman.
Here are some tips from her with links from other websites that expound upon her ideas:
Make the most of your grocery dollar
Use coupons wisely - buy only the things you need and will use.
Do freezer cooking (freezing meals or ingredients for meals) to make mealtime cheaper, easier, and less expensive. | Martha Stewart
Learn how to read grocery store flyers; just because an item is featured in the flyer doesn't mean it's on sale.
Be sure to pay attention to the price and not just the promotion. | The Simple Dollar
If you're stocking up, then understand store cycles
Knowing how stores fill their shelves enables you to stock up on items that go on sale at regular intervals.
For instance, if bread goes on sale every six weeks, stock up at that time and freeze what you can't use immediately.
“Learning how to buy smart, stock up things when they're on sale, and plan meals around those items is really key," says Greutman.
You're freezing meals, so buy a big freezer
Annette Economides, who co-authored the best-selling book, “America's Cheapest Family Gets You Right on the Money" with her husband, Steve, says an extra freezer is a must if you're serious about saving money on groceries.
“When you find deals on meat, dairy, bread, whatever, you can freeze them and capture those savings," says Economides, whose website America's MoneySmart Family presents great money-saving tips.
Here's one we liked, “The $400 investment we made in a giant freezer has saved us $2,000 a year."
Shop discount grocery stores
Shopping at discount grocery chains like Aldi can save you more than 40 percent over traditional supermarkets.
Shop less often
Economides reports that 60 percent of the items that consumers put in their grocery carts are impulse buys.
“The less you shop, the more you save," she says, which is why she recommends shopping just once a week—instead of two or three times.
Leave no stone unturned as you look for places to save money.
Consider every bill and monthly expense. Yes, every single one!
How?
Look for ways to trim expenses by exploring less expensive alternatives to what you are currently spending.
Try adding up how much you spend at convenience stores or on coffee one month.
Multiply that amount by 12 (number of months in a year).
You'll be blown away by the cost of the "smallest" things.
“Even though some of our regular bills might seem small and insignificant on their own," explains writer Trent Hamm in an article on The Simple Dollar, “their cumulative effect can be enormous — and become a huge drain on our resources.
Carving out some time to call utility companies to discuss better pricing plans for your needs can have tremendous value when you add up your savings over the course of the year.
Consider that cost-cutting strategy and a few more.
Cut back on dining out
Save eating at a restaurant only for special occasions—and when dining out with family, look for those establishments where “Kids Eat Free."
Also, don't overlook what you can save by taking your lunch to work. “If the average lunch costs $7 and you bring a meal to work three times a week, you'll save $1,000 every year," says Economides.
If you do find yourself still eating out, follow these suggestions from MoneyCrashers on how to save money when you're at a restaurant, including:
Target cheaper services
Look at cable or satellite TV, telephone service, and cell phone and Internet bills. “Call existing providers to find out if something is cheaper, and if not, look for an alternative," Hayes suggests.
An example is to get your entertainment fix by subscribing to more economical choices.
With the average monthly price of cable exceeding $100and satellite also on the rise, consumers can substitute “a la carte" entertainment choices like Netflix, Amazon Prime, or Hulu for as little as $8 per month and can subscribe to live-streaming options such as Sling TV for as little as $20.
For your cell phone, consider teaming up with family members to share a plan or explore a pre-paid plan for even more savings.
Clark, a money-saving blogger, has a few more tips on how to save money our your TV bill.
One of them is knowing when to call up the "customer retention" center and negotiate a better deal.
Save on auto insurance
Economides agrees with the famous TV gecko, recommending you get auto insurance quotes at least every three years.
“Rates are calculated by zip code, so if it's been a good year in your zip code, you could save a lot of money," she says.
Your greatest monthly expense is likely to be your home.
In fact, the average monthly mortgage payment is almost 16 percent of buyers' income—a seven-year high.
Sometimes, the prestige of living in a home with bigger square footage comes with the pain of taking on a much bigger mortgage payment than you can comfortably afford.
When you own your home but are "trapped" by having to pay large mortgage payments and/or taxes, you are what they, "house poor."
Think about everything under your roof, literally, that you pay for each month, and then make an assessment—is home sweet home an affordable home sweet home? If not, then...
Downsize your living space
Many people measure success by the square footage of their home, but a smaller home can make you more content and financially solvent, says Greutman.
Given their massive debt, she and her husband made the decision to downsize from a 3,200-square-foot house into a modest 800-square-foot townhouse.
“We saved ourselves about $1,200 a month, which freed up money to pay off debt a lot faster," she says.
Eventually, Greutman and her husband moved into a larger home to accommodate their family of four children, but it was a modest upgrade.
“It was half the size and a third of the price of our prior home," she says.
“We're snug, but we love it."
Reduce your mortgage payment
There are various ways to reduce costs over the life of your mortgage, according to the very handy U.S. Mortgage Calculator website.
Among the suggestions:
Target your utilities
Consider such ideas as adding insulation and using less expensive cooling sources (i.e., ceiling fans and attic fans instead of the A/C).
When buying appliances, looking for energy-saving options.
GET CREATIVE
There's some prestige in buying something new—a new car, new outfit, new furniture.
But what good are prestige and panache when you're shelling out money you don't really have to spend? (And are then faced with a bunch of "new" bills?!)
It's quite possible — and very satisfying to many — to buy things “pre-owned" and to wear those savings as badges of honour (with change to spare!). Follow our lead:
There are two ways to build savings—cut expenses and add income.
While most saving methods focus on the former, don't overlook the potential of the latter.
Get a side hustle
If you still need extra cash, consider an extra source of income like working a part-time job, driving for Uber, or signing up with Task Rabbit to offer freelance labor in your area.
Hayes delivered pizza to help pay off his debt, observing that the great thing about many of these side hustle jobs is they offer flexible hours.
“Anybody can work a side hustle so long as they find something that works with their schedule."
Savvy consumers do their homework and make use of tools that can help them save and budget.
Use technology tools
Hayes suggests using apps that facilitate your saving goals.
Sign up for loyalty programs
Just about every type of retail business has a loyalty card—pharmacies, gas stations, sandwich shops, pet stores, movie theaters, and more.
Use these cards for instant discounts and to earn points redeemable for cash or free products.
Know when to fill up
In some markets petrol prices rise and fall in a cyclical pattern, with midweek being cheaper than the weekends.
Additionally, many observers report that the best time to fill your tank is first thing in the morning, since stations tend to raise prices during the middle of the day.
Do your research
If you know what things cost, you'll be better equipped to spot a good ideal—and reap the savings rewards. “There's always stores that have overstocks or items close to expiration that they're marking down," says Economides. “If you know your prices, then no matter where you go, you will always find a deal."
It's not necessary to spend big bucks on your kids' entertainment; instead, take advantage of free or inexpensive venues like parks, playgrounds, hiking trails, and neighborhood carnivals.
“It takes a little more effort, but you can always find something that kids can do for free," says Economides. She and husband offer several great tips in their blog post, 21 Inexpensive Recreation Ideas," such as:
Look for free or low-cost entertainment
- Trade higher-priced box office prices for high school or university concerts and theatrical productions.
- Visit museums on “free-admission" days.
- Watch a parade or hot-air balloon race.
Take a tour
Contact local businesses to see if they'll host your group for free. Some options include:
- Local factories | Parents
- The post office (contact postmaster at your local post office)
- Airport (check local websites for tour requirements
- A radio or TV station
- Nearby farm
Rather than indulging your kids' whims by spending money on toys or activities with fleeting value, give them the lasting gift of a firm financial foundation that will be a key to the future savings success.
Your kids won't be spoiled and you'll be saving money for something more worthwhile (to them and you) - your financial security.
“We have a whole kids and money program called Money Smart Kids," reports Economides.
Here are some of her suggestions:
Teach kids to budget
Economides and her husband did this by instituting a simplified budget system.
“We used cash envelopes," she explains.
“Payday was once a week. We taught them how to shop thrift stores and rummage sales, and they all grew up with frugal skills."
Make sure your kids have “skin in the game"
If you're saving for a trip to Disneyland, make it a family-wide effort. “Everybody saves their money for it," Economides says.
While the parents pay for food, hotel, and transportation have the kids pay for their own souvenirs—and if they're older, possibly their park tickets as well.
That way, everyone experiences the financial responsibility of saving for something special.
Teach the value of ownership
Giving kids an allowance and teaching them to save will help them grow up to be financially smart adults, according to a recent article in U.S. News and World Report.
It gives them appreciation at an early age for the things that money can buy.
“The younger they experience ownership, the better because that will teach them to take care of what they have," Economides says.
Learn to do-it-yourself
One of Economides' saving strategies is to do for yourself what you otherwise might pay people to do.
“We make our own birthday cakes, and mom does haircuts," she reports.
“I had a barber give me a quick tutorial for the boys."
Know your limitations
If you need the specialized skills of a plumber or electrician, it makes sense to hire a pro.
But you might be able to accomplish other chores, like power-washing the deck or painting the kitchen, yourself.
“If you've never done it before, go on YouTube, and learn how to do it," Economides suggests.
Consider student labor
If you don't have enough skill to do something yourself, contact a university or college.
You might be surprised what's available to you—everything from cosmetology students who can cut and style your hair to graduate-level dental students who can extract a wisdom tooth.
Indeed, they helped writer Paul Sisolak save $350.
Exercise on the cheap
Depending on the type of gym membership you choose, you could spend anywhere from $25 to $200 per month.
Save that money by walking, biking, or jogging around the neighbourhood or buying some inexpensive or used exercise equipment for your home.
See the Big Picture
Diversify your portfolio
The old saying, “Don't put all your eggs in one basket," applies.
A mix of investments is protection against everything going south at once and will give you more stable earnings.
Some savers are risk-takers; others are risk-averse.
The key is to find a strategy that suits your personality but still enables you to make a good return with risking money you can't afford to lose.
Write it down
“People may say, 'I just want to get out of debt.'
Okay, but why are you trying to get out of debt?" Greutman asks.
“What are you trying to achieve? A different lifestyle? Financial freedom? Less stress? Write that down, put it on your wall or your fridge, and that's going to be your motivator when times are tough."
Learn from your mistakes
Greutman compares changing your money habits to learning to ride a bike.
“You know you'll fall, but you have to get back up. Realize that that's part of the process."
Stick to it
Even when you make a mistake, focus on your ultimate goal as motivation to keep going. 
Says Greutman, “If you can stick to your 'why,' you're going to have a lot greater chance of success."
The time to take action in changing your saving strategies is now.
You can think like a saver, be creative, and constantly keep the big picture in mind with the tips shared here.
Put a dollar in that jar!
Remember, your ultimate goal with these saving tips is to live a better and more financially secure life - surrounded by people who love and respect you, so the only stress you'll have is: How to enjoy life, not just survive it.
So now we have to ask: what saving tricks have you used that actually worked?
