Why not bulk up your savings account while you’re in school? Use these five quick and easy
strategies to save. Once you graduate, you will have extra funds in your account to use for down payments, emergencies, and more!
Create a budget
In order to create an effective budget, start by calculating your monthly take-home pay. This is different from budgeting by your salary (divided by 12 months) or your hourly wage (multiplied by hours worked). It’s the amount you actually take home after your paycheck deductions.
Then, instead of looking to your account balance to decide whether or not to purchase an item, look to your budget instead. This will effectively determine what you can or can’t afford, since your current account balance can’t tell you how much you’ll need for future expenses.
Pay yourself first
With this savings method, as soon as you get paid, transfer money into your savings account first. Determine a set amount of your income you’d like to save before you begin to take care of other expenses. The size of the contribution is up to you, but $100 is usually a great place to start. However, even small amounts add up overtime!
To make paying yourself even easier, set up an automatic transfer to move your desired amount from your checking to your savings weekly, bi-weekly, or monthly.
Use an app
There are tons of great apps that can help you budget and save. A few of our favorites are
Pocketguard shows you how much you have for spending at any given time. It calculates the funds available to you after accounting for bills and savings goal contributions. Clarity Money organizes multiple accounts for different financial institutions to track your spending. It also monitors your credit score and allows you to cancel subscriptions right on the app.
Use the envelope method
One old-school, yet effective saving method is the envelope technique. With this, you decide how much you would like to spend each month on different categories like eating out, entertainment, groceries, etc. Then, withdraw cash and divvy it up between the envelopes. Whatever you budget for the month is how much you have to spend; if you go over in one category, you take from another envelope.
Count your coins
Counting your coins could be a great savings method to pair with the envelope method. Collect all of your spare change and store it in a container. When it’s full, take it into your nearest financial situation with a free coin counter. Southland Long Beach has one – it’s free for Members! Once your change is counted, deposit that amount straight into your savings account. Even small coins can add up over time.
Visit SouthlandCU.org to learn more about Southland’s offerings, take interactive financial education courses, and more.