Piggy bank empty after a busy holiday? Here's how to fill it back up
Saving money is no easy task, and it can seem particularly daunting after a holiday season full of spending. If you're looking to get back on track financially this January, there are actually some simple things you can do that will also help you achieve your money goals for 2018. Starting the new year off with some decluttering, a bit of a buying ban and some careful planning could actually have a huge effect on your finances over the coming months. It can seem a bit intimidating to put a solid financial plan in place, and it turns out that many Canadians may not be as good at saving as much as we should be. But financial expert Rubina Ahmed-Haq knows that fear can really hold us back from achieving our financial goals, so she stopped by The Goods to discuss four simple ways to grow your bank account in 2018.
Pay yourself first
It's very important to invest in yourself first and to make those contributions automatic. After paying your personal bills like cell phone, car payment, internet etc, put leftover money into a long term savings account every month. Examine where you are spending too much by keeping a spending journal to see where you have wiggle room. Look at your variable spending, including groceries, coffees, and transit because it all adds up. Also, consolidate your credit cards if possible so that you're better able to manage your flow of cash and credit and avoid pricey interest fees.
Learn the art of delayed gratification and how to walk away from impulse buys. Think about the item that caught your eye, and then go back after a day if you truly still want it. Rubina uses the rule of $100: if it costs more than $100 and you have not planned on buying it, walk away and see if you still want it 24 hrs later. BMO did a study in 2012, that showed that impulse shopping costs Canadians almost $4000 a year! So don't be part of that statistic, and learn to say no to yourself now and then.
To the best of your ability, start the new year off by buying nothing in January. Brown bag your lunch, take transit or walk to work. Of course, you need to buy essentials, like food but try to spend as little as possible – no clothing buys, no nights out. Instead, enjoy time at home with the family and low-cost nights-in with friends. If you're feeling really ambitious, you could bump this idea up a notch and have a zero spend-day once a week. This is best to do on your day off, like a Sunday. Stay at home, eat what's in your fridge, cook food for the week, do laundry, watch a movie. If your friends badger you, just say "I can't afford it this month," and they'll likely back off and maybe even suggest a cheap or free alternative. Imagine what you could save in 31 days.
Declutter, sell and return
Look around your home for items you are no longer using. Sell things that have value and use the cash to save or put toward your debt. This includes Christmas presents you know you're never going to use that you could return for cash or gift cards. Use popular buy, sell and trade sites such as Bunz, Kijiji and Craigslist, and look for online community groups in your area. Once you sell, be sure not to spend it – put the money back into your savings account and watch it grow.