There's no real secret to reaching your savings goals, but there is an attitude of commitment that you should consider adopting in order to accomplish them. In order to keep your commitment to save, make it a priority: decide what you will save each month and learn to live on the rest.
This approach ensures that you don't run out of money each month before you get around to saving some, and it means that you don't have to abide by irritating mantras like the latte factor. Everyone's spending priorities are different so all encompassing mantras aren't always appropriate, but no matter the reason for saving everyone aiming to set aside more money shares a common goal. Discover a few not-always-obvious places to find extra money when you read more.
According to Kiplinger, a 30-year old with no savings must save $448 each month in order to have 1 million by age 65, and that's assuming the account earns an interest rate of 8 percent. It may seem daunting, but it isn't an impossible feat. They suggested six places in our spending lives that may have room for extra savings, and I've selected the three that aren't always apparent.
- Save $219 per month on taxes: The average refund for the 2008 filing season so far is about $2,500. If you received an average refund and you are in the 25 percent federal tax bracket, you could be entitled to three extra exemptions worth $3,500 each. That would boost your take-home pay by $219 a month. A couple of reasons you might be eligible for more exemptions: becoming a new parent or buying a house.
- Save $28 per month on health care: The typical family spends $1,321 on out-of-pocket health expenses each year, says the Department of Health and Human Services. You can pay those costs with a flexible spending account, which lets you set aside pretax dollars.
- Save $10 per month on auto insurance: The average consumer pays $829 annually for car insurance, according to the National Association of Insurance Commissioners. Raising your deductible from $250 to $1,000 can save you 15 percent or more.