How can I save money without feeling like I can't ever spend money?

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By Amanda Christensen, Extension Associate Professor

November 4, 2020

A common conundrum when managing your personal finances is figuring out how to save money without feeling so strapped. If you have ever asked yourself this question then the following tips are for you: pay yourself first, automate your savings payment, and set up a rewards system for your savings goals.  


Tip 1: Pay yourself first. To pay yourself first means to actively contribute a specified amount from each paycheck, at the time it is received, into a separate savings (or investment) account. Treat it like a bill that must be paid. If the savings “payment” comes off the top, right when you’re paid, then you can spend what’s left on wants and needs without feeling a pang of regret for letting another month go by without stashing away some cash. 


Tip 2: Automate your savings payment. A critical step to a successful savings strategy is to automate your savings “payment” to yourself. When you automate your savings payment, it is much easier to “pay yourself first.” Set up a recurring, automatic transfer from checking to savings through your financial institution or add an additional automatic deposit through your employer.  This one action will save you from having to think about it every time you are paid. It will happen automatically!


Tip 3: Set up a rewards system for your savings goals. Paying yourself first and automating your savings payment are great strategies that help you build your spending around your savings goals. So is rewarding yourself as you hit milestones in your savings journey. Simple rewards like going out to eat once you are halfway to your $1,000 emergency savings goal can keep you motivated and disciplined.


Pro Tip: We often save for emergencies and retirement, but we ought to also save for the short term, slightly more enticing purchases such as a vacation, or a home update rather than purchasing these on credit.


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