(BPT) – The pandemic created a lot of uncertainty for people, especially when it comes to their finances: unemployment was up, spending was down and just about everything felt like a roller coaster. A year after much of the world was shut down due to the coronavirus, it’s time to replenish your savings to unlock opportunities for you and your family.
But how do you prioritize savings when, like many Americans, you live paycheck to paycheck? Or do you have other debts? Or do you really want to buy that expensive item you were considering? Sesame Credit has some tips to help you open new doors and reach your savings goals.
Cut the fat and the extra costs
Start by reviewing your budget. First and foremost, identify your basic needs – these include your living expenses like shelter (rent or mortgage), food, utilities, and basic transportation. Then take stock of all your recurring monthly expenses and look at your credit card statements for things like subscriptions you don’t currently use or could live without (do you really need Netflix, Hulu and Disney?). Regardless of the economic environment, you need to prioritize your finances the same way.
Your bank account is another area to look at where you risk overspending. According to financial technology firm Stilt, consumers paid $ 11.6 billion in bank charges – including overdraft and ATM fees – in the first three months of the pandemic. If your bank is currently charging you to access your own money, consider switching to a no-fee online banking like Sesame money where you have no minimum deposit, no overdraft fees and free withdrawals at over 55,000 ATMs worldwide.
Once your needs are met and you have identified the amount you need to allocate for other expenses, you can focus on building up your savings, paying off your debts and splurging for the occasional âneedâ. like going to a restaurant or buying a new phone or a new car. .
Establish a savings routine
Building up your savings is the best way to prepare for the future and prepare yourself and your family for success. Having a savings account can act as an emergency fund that can keep you financially stable when unforeseen costs or emergencies arise – whether it’s a sudden job loss or essential car repairs – and you avoid getting into debt. Saving isn’t easy and it can take time to build a nest egg that will open up new doors for you, so it’s important to get started right away.
Make sure you pay your bills on time and cover your essentials first. Missing bill payments can have a bad effect on your credit score, which can cause you to pay higher interest rates in the future, so making at least the minimum monthly payment on your bills is number one. . If you have any money left over, you can start setting aside even small amounts in a savings account. You can also set up automatic deposits to transfer a fixed amount each week from your checking account to your savings account so you can save without having to think about it.
Start small and celebrate victories
It’s okay to start small – even saving $ 2 a day will pay off and earn you $ 728 after a year. If you can save $ 50 per week, you will have saved $ 2,600 in one year. It’s important to celebrate your milestones along the way and set achievable goals for yourself – from your first $ 100 saved to your first month of savings on a consistent basis.
It’s also important to make sure your savings are accessible if you need them in an emergency – try checking out a high-yield savings account to store your money. A general rule of thumb is to work to build up enough funds to cover a 6 month period of rent, utilities, car payments, and other financial commitments. This number might seem daunting, so start with smaller goals to save your first $ 500, $ 1000 and beyond.
Don’t forget your credit
Your credit and liquidity go hand in hand when it comes to your financial health. Paying off your mortgage or rent and bills on time keeps your credit score healthy, which opens the door to better credit card deals and lower interest rates on everything from paying for your car to credit cards, which saves you money in the long run. If you have a good credit score and have already made payments on time, asking your bank to increase your credit limit could also give you more access funds, or at least give you a buffer if you need it.
Look in resources like Credit Sesame is free Sesame money online bank account and debit card that can help you earn money – up to $ 100 – when your credit score goes up. Rebates and cash backs can also help you put money away to save: Credit Sesame, for example, offers up to 15% instant cash back from thousands of restaurants and retailers when you use your debit card. This way you improve your credit score and save for the future. And if you connect your employer or IRS direct deposit (including your tax returns and future stimulus checks) on your Sesame Cash account, you can be paid up to two days in advance.
Keep an eye on the price
Saving money isn’t easy, and it’s not exactly fun – but as the world continues to reopen after a year of lockdown, saving now can prepare you for that vacation, a bigger purchase, or coming back. to “normal expenses” once it is safe to do so.
To learn more about how Credit Sesame can help you replenish your savings to unlock new opportunities, visit creditsesame.com.