Follow Our Advice on Saving Real Money For a Rainy Day
You’ve no doubt read the clickbait headlines lamenting the fact that you could save thousands of dollars every year if you’d just cut out little conveniences here and there from your day.
The truth is, enjoying a latte on your way to work or buying a pastry from your local bakery aren’t the villains sucking your savings dry.
In all reality, you’ll have to start thinking in much broader terms if you want to stockpile some serious funds in your savings account.
At Bankruptcy Canada, we understand exactly how difficult it can be to accumulate money in savings, which is why we’re outlining the easiest ways you can start amassing more immediately.
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Beware The Allure of Credit
The old saying “out of sight, out of mind” certainly applies to money.
When you pay for something using a credit card, the money you spent was never really in your possession in the first place, so it’s far less impactful once it’s gone, which is why credit cards are the single biggest savings thief there is.
In fact, studies have found that shoppers will spend up to 100% more when they are paying with a credit card as opposed to cash.
While credit cards allow you to prolong the inevitable payback for a period, you’ll wind up paying more, in the long run, thanks to interest rates.
For this reason, you should be especially mindful of what you put on credit cards, and how you utilize them.
It’s true that many cards offer points as part of a rewards system which can be redeemed for cash back; it’s also true that many credit cards provide a period of 0% intro APR, meaning that the balance on your credit card will not collect interest for a number of months after the account is activated.
These two factors being the case, there are a couple of ways you can utilize credit cards without ruining your hope of putting away large sums in savings.
First, if you know you have a large purchase on the horizon, you could consider opening a new credit card and charging the purchase to it in order to avoid interest and collect points.
This option should be discussed with a financial professional, as it’s not always a prudent move.
Should you choose to go this route, it would be important that you pay off the balance of the new credit card before the introductory period lapsed, but that should give you plenty of time to add a steady sum to your savings account while still making regular payments.
The other option is to charge ordinary bills that you would have to pay anyway to your credit card.
Things like your internet, utilities, and other subscriptions can come out of your credit card, resulting in accumulated points without excessive spending.
You do not have to forgo credit cards entirely in order to have a healthy savings account, but you should learn to manage credit rather than let it manage you.
Shop Less, and Buy in Bulk
No one intends to overspend at the grocery store, but that’s precisely what many people do.
If you took the time to really inspect your pantry and freezer, you’d likely realize that you could afford to go without your weekly trip to the store; how much money would that save you?
There’s no question that groceries are a necessity, but taking a smarter approach to your shopping habits will allow you to stockpile a fair amount of money in savings without impacting your lifestyle.
One of the easiest ways you can save money (and time) by changing your grocery shopping habits is simply to start buying in bulk.
It’s far more economical to buy products in large supply, and many common household supplies like bread and meat keep perfectly well when frozen.
Considering that you can save upwards of 80% on some items when you buy in bulk, you’ll have thousands of extra dollars to put toward savings after a year if you get serious about changing the way you shop.
Get Savvy When It Comes to Car Shopping
New cars depreciate significantly as soon as they’re bought; it’s far more economical to buy a used car, even if it’s just a few years old.
Plus, cars today tend to hold their value for far longer than in days of old, so there’s little risk that a used car will suddenly stop running.
If your household has more than one car, consider whether or not multiple vehicles are really necessary.
If you were to sell one, the income you would gain from that sale could be automatically added to your savings account.
Reliable transportation is a necessity of modern life, but if you’re not smart about your car buying (and owning) habits, they could be surreptitiously keeping your savings dangerously low.
Always Try to Negotiate
Even if it’s not in your nature to try to wheel and deal, you should attempt to affect a business-like persona if you’re planning to buy or sell a house.
There are many finer points of the home buying and selling process that can save you money if addressed, such as your real estate agent’s commission.
Although 3% is customary, you’ll likely be able to negotiate it down to 2%, which will save you thousands of dollars.
Similarly, if you own a home, you should pay close attention to your property taxes—there’s a good chance they’re overvalued.
If you take the time to appeal the assessment, it could spell a huge amount of extra money to pad your savings with.
Skip The Small Stuff, Start Saving Big
Slow and steady wins the race, but if you’re tired of saving small sums without it ever amounting to anything, then it’s time you assess your methods and take more effective measures.
We are here to help with your savings efforts in whatever way possible, simply reach out to see how we may be of service.
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