Strategies for saving money now

One thing that I learned during my career on Wall Street – the best way to save is to live on less than you make. Of course, building up your savings isn’t always the easiest thing to do, especially if you’re spending most of what you make on regular bills. But there’s hope for you yet, even if you’re living paycheck to paycheck.

Plan to put away a percentage

Cutting back on expenses like your triple macchiato coffee every morning can really cut spending, but that’s not always the best strategy. Instead of sweating all of the little stuff, worry about the big picture. Plan to put aside a certain percentage of your earnings every year – 10 percent is a good place to start. So if you’re making $100,000 – good for you – then you’re putting away $10,000 a year.

Use your resources

If you’re company has a 401(k), you should be contributing. That’s one easy way to make sure that your savings is building the way you want. Often, you can opt to have a percentage of your paycheck automatically put into your 401(k) plan – which will keep you from cashing it and going out to buy a TV with the money instead.

Build your emergency fund

The first rule of finance – have an emergency fund. If you don’t already have one, it’s time to start building it up. Ideally, it should be between three to six months of living expenses. Put it in a savings account, money market fund, money market account or another liquid investment. But whatever you do, save first. If you wait until the last minute, you’ll be scrounging to find that 10 percent.

Remember, savings should always come first. It doesn’t have to be 10 percent of your salary, but you should set a goal to put away a certain amount each month and an overall amount each year.

What are you strategies for saving money?