Saving money is one of the best ways to prepare for the future, ensuring that you have the funds available to handle any financial issue that may arise. Unfortunately, there are many products and services vying for our hard-earned money and it can be very difficult to avoid the temptation to spend. There are a number of tricks and tactics that can be used to curb your spending and save more money for other needs. Here are some time-tested ways to stash more cash in your savings account.
Account Padding
One of the easiest ways to avoid spending the money that you intend to save is to pad your bank account with unaccounted for money. This can be accomplished using several tactics. Some people make a deposit into the account that is not reflected in their account ledger, effectively hiding the money from themselves. Other people choose to enter a withdrawal into their account ledger without removing the money from the account. Using this tactic allows you to save money while providing a cushion against overdrafts that may be made accidentally.
Denomination Saving
Denomination saving is one of the more creative savings tactics available that can help you save a large amount of money quickly. Whenever a certain denomination of money, such as a $5 bill, crosses your hand, put it away somewhere for saving instead of spending it. This works better if you routinely use cash for your purchases instead of a debit or credit card. Over time, you will see the amount of money put aside grow considerably and once it reaches a certain amount, you can place the money into your savings account for a quick balance boost.
Create Your Own Savings Tax
Another creative way to fund your savings account is to institute a personal tax on an action with the money going towards increasing your savings. One way to accomplish this is to charge yourself a $5 personal tax every time you purchase non-essential items, such as articles of clothing or movie tickets. Another tactic often used is to dedicate a small percentage of your income, often between 3% to 5%, to your savings account every time you are paid, with the money taken out before the rest can be spent, just like a federal tax. Using this tactic curbs your spending and ensures that some amount is put into your savings account on a regular basis.