If you’re like me, you have some big financial goals in the upcoming years. We’re in the process of saving $100,000 to have as a down payment for a home, so we’re looking at finding as many ways to make and save money as possible. Our goal is to save a minimum of $20,000 per year – so here’s how we’re looking to save $20,000!
End the year with an extra $20,000 in your bank account: for each and every one of these tips, make sure that you are putting the money in a separate account! DO NOT store it in the account that you use everyday. If the money is there, you are more likely to spend it. I keep my extra savings in a completely separate savings account that is marked “house savings.”
As a note: most of these ways are REALLY simple. Saving money is truly not a complicated process.
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Start Saving 10% of Your Income
Get in the habit of depositing 10% of your paycheck into a separate savings account. If you’re not currently saving anything from your paycheck, it’s time to get started.
If you’re not able to immediately start putting 10% into savings, then take it in small steps.
Here’s an easy way to step into 10% savings: start by saving 2% in the first month, and every 2 months, bump up your contribution rate by 2%.
If you started in January, then you’d start with 2%, increase to 4% in March, then to 6% in May, 8% in July, and then 10% in September.
By slowly building up to those savings, you’re allowing yourself to become more practiced at budgeting, which will help you for those “emergencies” when you’ve forgotten to account for an expense (hellooooo, once a year account renewals; I’m looking at YOU, Amazon Prime!).
The median household income (as CNBC reported after the 2015 census) was $56,516, so this could add roughly $5000 to your savings account each year (depending on where you measure up against the median income and how much is withheld for taxes).
Work Overtime Whenever Possible
If your workplace offers overtime, take it! Joe is salary, so any hours that he works outside of his 9-6 is not overtime pay. However, my job is hourly, so when I stay any longer, I get overtime pay! Whenever possible, I sign up for those hours of overtime.
Tip: make sure that you know the laws for your state. In some states, any hours above 40 for the week will count for overtime. Since I’m in California, any hours above 8 per DAY will count as overtime.
At time and a half, those dollars will add up. Bring on the big bucks!
Make sure that you set aside those overtime hours into your savings account: don’t spend them! I battle with the “treat yourself” mentality, and want to spend to reward myself for that work.
Train your brain to think of your savings account as the reward for all of that work: your future self will thank you!
Take on a Side Job
Do you have any room in your schedule for a side job? Consider adding a part time job to help accelerate your savings.
Set things up so that your entire paycheck from the side job gets deposited directly into your savings account: if you don’t “see” the money in your bank account, you’re far less likely to spend it.
Even as little as $500 extra a month will result in a total of $6000 extra at the end of the year. That’s significant progress towards your savings goals!
The holiday season is a great time to take on a seasonal job.
Tip: know the amount of time that you actually have to give to a side job. I applied for several part time jobs, but was offered positions at different stores (not the closer ones to me, which would have been far more desirable). When I evaluated the time that I actually had, and the workload that the day job had, it was better for me to take on overtime and extra hours rather than taking on a new job.
Obviously, every situation is different, but you can make smart decisions that will help ramp up your savings.
Learn a New Skill and Freelance
Are you good at editing? Can you format a Microsoft Word document like a pro? Consider freelancing! Through sites like UpWork and Fiverr, it’s easier to freelance than ever!
Brush up on your skills, prepare your offerings (I recommend making simple packages of services that you offer – start simple, and add more from there – you can always expand!)
If you don’t have a marketable skill, go to YouTube and learn. There are so many free resources out there that you can learn from, and practice!
I’ve been able to make at least five figures in 2019 by freelance writing, and am looking at even more new ways to bring in more income in 2020.
Sell Anything You Don’t Use
Selling extra “junk” has two benefits: first, you declutter your house. Secondly, you bring in some extra income. I personally have opted to use Mercari, and currently (as of December 2019) have 47 five-star reviews.
Mercari is great because you can post your own pictures of items, set your prices, negotiate, and even print your own shipping labels from their site. Just make sure that if you use Mercari’s labels, you weigh the item in packaging before printing a label.
I’ve moved clothing, shoes, journals, and unused knick knacks from around my house.
You can also use Poshmark and Facebook marketplace to sell unused items around your house.
I highly recommend that you get some shipping supplies in order to sell on Mercari:
- Scale – shipping cost is determined by weight; I recommend digital to be as accurate as possible. If you have a food scale, you can use that.
- Bags – to put items in for shipping; serves as extra protection against shipping damage.
- Polymailers – these are super affordable shipping bags. They’re also super lightweight, so you don’t even up paying extra for shipping.
Through services like Mercari, I’ve been able to turn clutter into cash – in fact, almost $2000 worth of cash! All of my Mercari deposits come straight to my bank account, and I put it in our house savings fund. It’s amazing to realize how much I have been able to contribute just by moving clutter that I didn’t want to see around the house anymore.
If you want to get really savvy about reselling, watch trends and do a little research. I got REALLY lucky and was able to flip four $5.99 Rae Dunn mugs that I found at Marshalls for a total of $140. You have to be VERY careful about your research, and know what is going to sell, otherwise you stand a chance of losing money. I just happened to catch Easter items right after they were set out and still very hard to find.
Create Affiliate Income
I love affiliate income. There’s nothing quite as fun as getting an email saying that someone has purchased using your link, and that you have money!
Because I have a blog, every link is monetized, and I appreciate all the clicks and purchases. It’s super cool when that happens.
However, you don’t have to have a blog to make affiliate income!
Rakuten is one of my new favorites. First off, you can get cash back when you shop – just install the Chrome browser and open shopping sessions through Rakuten. I mean, come on, I’m already shopping, might as well get a little cash back in the process, right?
But when I share my Rakuten link, I can get $25 for each qualified lead!
So a simple post every now and then on your social media channels helping other people get cash back could help you get $25!
Sign up for Rakuten.
Meal Plan to Save Money
This is going to feel like a huge “duh,” but when we put together our budget, it was horrifying how much of our income we were eating.
I mean, I get it – we all have to eat. But at the same time, the food budget is an easy place to cut back.
Before we could cut back, however, we had to get an accurate picture of just how much we were spending on food.
I would spend about $100 each week at the grocery store. I meal plan every week (typically on Saturdays or Sundays), and then go to Aldi, and then Walmart (for the things that they don’t have at Aldi, like Joe’s favorite yogurt, and my favorite low carb konjac noodles).
$400 a month isn’t so bad, for a household of 2, right? Well, yes – BUT what was getting us was the random Walmart trips during the week. I’d go to pick up one or two items that I forgot, and while in the store, magically remember all these other things we “needed” and I would typically walk away with quite a few extras.
Ultimately, that meant that anticipated grocery bills of $400 a month would become $500, or $600 – those “small” amounts of money added up each month. By simply planning (and sticking to the plan), I could save up to more than $2000 a year!
So those are some of the ways that we plan to save $20,000 in 2020. What are you doing to save money in 2020?
