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So I managed to save 10k last year


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Thanks for all the advice last year because it really made a difference! I really didn't think I could save more than 2k but I managed better than I'd expected 😍.

 

Now since you guys were so informative and helpful, what are some more tips on keeping strong and increasing that goal to 15k? I am trying to put around 350-450 into my savings every week.

 

Kinda hard cos I still need to socialise and that unfortunately tends to cost money. ;(

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Talk to an accountant and a financial planner. Make your money work for you and grow

what are some more tips on keeping strong and increasing that goal to 15k? I am trying to put around 350-450 into my savings every week. Kinda hard cos I still need to socialise and that unfortunately tends to cost money. ;(
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Open a brokerage account. Fidelity, Vanguard, Schwab, etc. As Wiseman suggested, make an appointment, and they can get you set up in something that will help you earn more than your savings account.

 

You don’t have to cut back on going out, but you do have to cut your spending while you’re out. Order house brands of alcohol; order appetizers instead of full meals. Share entrees with friends. Aim to cut your dining out spending in half.

 

Great job BTW!! $10K is a lot of money!!!

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Congratulations! Amazing efforts!

 

I've been having problems saving money. Can you share or link me to the thread with the tips on how to save more money?

 

Also as to socializing, would it help setting a specific "socializing budget" monthly that is in accordance to what you want to save? I've read online people who put the money they intend to spend on a certain category in an envelope and will only spend it from there and when it's over it's over. I've never tried it so I can't tell you if it's a good method or not, but I've read online people saying it works very well.

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Annia, to find the thread that Honeycomb is referring to, click on her name and view the thread from January 2018 where she wanted to save money by Xmas.....which she did! Sorry I can’t copy & paste the link from this device.

 

As for how to budget, it’s pretty simple really. I’m a little OCD, but I literally keep track of every single dollar I spend. If I’m out & about and I buy a latte, I put the $4.00 in my phone notes until I can add it to my spreadsheet.

 

My spreadsheet has a monthly budget for everything, but only about 8 categories.

Fixed expenses, listed by each. These include my monthly gym dues, cable bill, etc.

Dining Out

Groceries

Clothes, shoes, accessories

Misc.

Large, unexpected expenses

 

That’s it. Make yourself a budget for whatever categories work for you, given your income, and vow to spend one solid month of tracking every single dollar you spend. You’ll be amazed at what you’re spending on junk (I know I was).

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keep "paying yourself first" (aka the % off each paycheck you decide to "put away" and not touch until you reach some goal for somethign specific).

As for how to maximize saving yoru money.... Just look at every single expense you have and ask yourself if you can trim corners. For instance for me:

 

1. i trim corners on heating/AC buy looking into incentive programs with my power supplier (for me there is a plan that gives me discounted rates at outskirt times and higher rates during prime use times... i opt for these discount plans and program my thermostate to use MINIMAL power during the peak times... then do all my heating or dishwashing or laundry during off peak times). I also turn down the thermostat in winter and wrap myself in warmer clothes or a blanket.. and don't turn down so much the AC in summer and bought a small personal fan i blow at myself during hot days... etc. etc.

 

2. I "cut the chord" and minimize my tv packages. Instead of paying cable i may do $35/mo with YoutubeTV, or just go with a Hulu or a NetFlix. I can always rotate around as needed between the 3 say if... i want to watch the NFL season i'll shut off netflix and get youtubetv. but once the season is over, might cut youtubetv and go back solely to netflix. Lots of stuff you can do here.

 

3. Minmize on wireless service. i don't always buy the latest phone. I've opted to pay iCloud for $2.99 instead of spending an extra $300 to get more memory on my iPhone. I switched to T-Mobile for unlimited data and a flat monthly fee for their service.

 

4. I love the idea of doign more "cheap" group activiites rather than just do the happy hour eat out thing. Why not a potluck at home? Cookout at a friends house? Do a group netflix or board game night? The lady I'm dating and I (since i hav some unexpected expenses for home repair in Dec) now Netflix binge our favorite show for our dates rather than go out. That saves at least $50/date! And we get more private and cuddle time!

 

5. Hopefully you feel comfy or this will start you on the path of exploring financial investing. A great idea i heard somewhere for beginners.. is to figure out how long you can go without the money or touch your savings and then "rotate/invest" that money in the highest yielding CD's you can find for that time length. So let's say you have $300. You figure you can comfortably not touch it for 6 mos. You go and find the highest yielding 6 mos CD on the market (lets' say you find something at 5%).

 

What you do then is buy your first 6mo/.05 CD (say it's January) for $100. (you still have $200 usable savings if you need it)

Then in March you buy another 6mo/.05 CD for $100. (you still have $100 usable savings if you need it)

Then on May you buy a 3rd 6mo/.05 CD for $100. (you have $0 usable savings)

 

Come July you get paid $105. and still have $200 accruing interest. (you have $105 usable savings if you need it)

Come Sep you get paid another $105 from teh 2nd CD you bought. Now you re-invest first $105 in another 6mo/.05 CD. (you now have $105 usable savings if you need it).

Come Nov you get paid another $105 from the 3rd CD you bought. Now you re-invest the second $105 in another 6mo/.05 CD (you now have $105 usable savings if you need it).

 

And just keep rotating that way. In essence you are getting paid every 2 months your 5%, and basically have your last paid 5% on hand if needed.

And of course since you didn't invest it all at once and have to wait.. if the market goes up and you can find a 6% in 6 mos.. you can take advantage of that.

 

Hope that made sense. Good luck! and GREAT JOB!

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These are amazing tips, thanks so much! I will definitely start keeping a diary of my expenses and will look into buying stocks later on this year. I think one of the best tips I've gotten was the delayed purchase. If I wanted something, I was told to wait it out for a month- if after the month is up and I am still wanting it badly, I can then consider buying it.

 

I've cut down on my lunch costs and will stick to a monthly entertainment budget. Ideally, if I can save 400-450 a week, I know it'll be worth it in the long run.

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These are amazing tips, thanks so much! I will definitely start keeping a diary of my expenses and will look into buying stocks later on this year. I think one of the best tips I've gotten was the delayed purchase. If I wanted something, I was told to wait it out for a month- if after the month is up and I am still wanting it badly, I can then consider buying it.

 

I've cut down on my lunch costs and will stick to a monthly entertainment budget. Ideally, if I can save 400-450 a week, I know it'll be worth it in the long run.

 

I would not buy stocks unless you're really good at that kind of thing. I'd do the mutual fund LhGirl suggested and I believe those companies provide free financial planning advice. Very impressive and good for you! I spent 10 years saving after I paid off grad school loans. And it really paid off a lot. Good luck! (I ended up hiring a financial planner about 4 years in and still have one 17 years later -I know it's not my thing to pick stocks, etc).

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I would not buy stocks unless you're really good at that kind of thing.

 

Great point, and I want to clarify: By opening a brokerage account, you can open a mutual fund, which is a far better plan than picking stocks.

 

Go to Fidelity, Schwab, Vanguard, or find another house, and meet with an advisor. You can do this over the phone. You can put all, or part, of your money in an S&P 500 mirror fund (designed to mirror S&P 500 performance), money market, etc. Spend some time with the advisor and detail your financial goals. Look at fees and compare them, as that's how they make money, and do what's best for you.

 

Once you start accumulating funds, it's not a bad idea to open another brokerage account with a different company and compare the performances of each. Fund managers are highly paid financial employees, who buy and sell all the stocks in your funds for you. You can leverage your gains/losses across different funds. Do not be disappointed in market trends such as 2018, as historically, the market gains, long term, and you are in it for long term.

 

Love the app idea from mustlovedogs. Add it to your phone, and commit to it for one full month, to track every penny, and you will get a clearer picture of where you need to cut.

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These are amazing tips, thanks so much! I will definitely start keeping a diary of my expenses and will look into buying stocks later on this year. I think one of the best tips I've gotten was the delayed purchase. If I wanted something, I was told to wait it out for a month- if after the month is up and I am still wanting it badly, I can then consider buying it.

 

I've cut down on my lunch costs and will stick to a monthly entertainment budget. Ideally, if I can save 400-450 a week, I know it'll be worth it in the long run.

 

The better system is:

if you want something, wait until you've accumulated enough money to buy it outright.

Once you are able to buy it outright, if you still want it bad enough - go get it!

 

I would use this over the "wait 1 month" rule as if you havn't accumulated enough saved money to purchase it outright, you're encurring debt all over again. And encurring debt is a no-no in best financial practices.

 

As far as investing and mutual funds, bla bla bla. here are some general tip, industry "knowns", and personal experience:

1. For the beginner who doesn't want to, or feel confident, about researching specific stocks to buy/sell, a mutual fund is a terrific way to diversify and limit risk. But realize it's FAR more expensive to do mutual funds over specific stock purchases. CHECK OUT the "fund management fee" typically in the 1-3%/yr range. (TIP: Vanguard is notorious for having the lowest management fees for mutual funds...)

 

2. If you want to go the mutual fund route, studies have shown that a great fund to go with is the S&P500 index fund (each investment brand may have their own version of an S&P indexed fund). Although there are plenty of funds that out-perform the S&P each year (approx 10-15% funds beat the S&P in any single year), most of those don't CONSISTENTLY beat it. So by sticking to a S&P500 index fund, you are going to be in the 85% or higher of performance annually.

 

3. An even better mutual fund is a Russell Index based fund- basically an S&P500 for mid-cap stocks (aka smaller companies.. not the biggest major companies). General concensus is the smaller the company the more volatile the company, thus more risk, but more reward. however studies have shown that even with more risk the Russell Index's rewards during good times, far outweigh the risks of bad times - and that the perfomance during bad times aren't nearly taht much lower/riskier than the S&P500 in most years. So IN REALITY, the Russell Index gives you better performance in both types of cycles. (I myself now make my bread-n-butter a Russell Index based fund instead of the S&P i used for a long time).

 

4. The best strategy for mutual funds is somethign called "dollar cost averaging." And that is.. you maximize your "diversification" by buying in regularly a regular alottments to counteract cycle ups/downs. (Ex. Buy $100/worth of the mutual fund every 3 months. and just keep doing that). The philosophy here is that.. if the cycle is up and the price is expensive, you are purchasing fewer shares with that same $100 for that cycle. During cycle down times where the price is low, you are accumulating MORE shares for that $100. The end result is the the avg cost per share is overall lowered so that your overall return is even higher).

 

ex.

Q1. S&P=$25/share. $100 purchases 4 shares.

Q3. S&P=$50/share. $100 purchases 2 shares. You now have 6 shares for $200 = $33.33/share avg

Q4. S&P=$10/share. $100 purchases 10 shares. You now have 16 shares for $300 = $18.75/share avg

Q4. S&P=$50/share. $100 purchases 2 shares. You now have 18 shares for $400 = $22.22/share avg

 

So to compare buying it all at once vs "dollar cost averaging".

If you spent all $400 on Q1 @ $25/share. You've have 16 shares worth (at $50/share) = $800

By dollar cost averaging, you have 18 shares @ $22.22/share now worth (at $50/share) = $900

 

This can apply to any investment purchase but since you expect index funds to be more stable (and stocks to be more up/down) - this works like a charm with mutual funds.

 

Good luck!

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I love it. Auto tracks spending, categorizes it, and shows you trends. It makes it really easy to budget and save.

 

I bank with Wells Fargo and after some initial personal settings there is a feature that tracks all my spending for me by categories.

I can long onto my account and see real time and colored graph that shows my activity and goals.

It makes a difference to see in writing, rather than just imagining it my head. It's a great tool and good reinforcement.

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  • 2 weeks later...

You guys are too awesome. I have documented all my spending for the last 10 days, and have kept away from all stores. I will aim to keep my entertainment costs to around 65 dollars a week which is lower than before but manageable. Aiming to save a minimum of 400 dollars but will try hard for $450 a week. I have started to make lunch and will start meal prepping from tomorrow onwards.

 

Will update in 3 months =D. I hope to be live modestly and keep my mind on the main goal.

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  • 8 months later...

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