1. Create a Budget:
First and foremost, create a spreadsheet in Excel — or another program — and start tracking every single purchase or payment. Do this for about a month or two to get an idea of where your money gets spent. This is a huge eye opener for some people and from here you can consciously decide how you need to change your spending habits.
2. Selling Items:
Go through your closet, garage, and boxes to find items you are no longer using. Then you can either have a garage sale or sell them online at Amazon, Ebay or Craigslist. Selling your unwanted things can boost your savings dramatically.
3. Stop Buying:
It sounds simple, but it takes a great deal of restraint; especially if you are accustomed to buying the newest gadgets or clothes. The next time you want to buy something, ask yourself if you really need it. Most likely the answer is no. When you do need to buy items, try to buy them used, and when something breaks try fixing it first.
4. Limit Entertainment:
Invite friends over instead of going out, go to places on days they are offering free admission, and look for other free things to do for entertainment. There are definitely plenty of things to do that don’t cost much money.
5. Get the Best Interest Rate:
Do some research to find a good interest bearing savings account. Also, you should never have to pay monthly fees to have an account since many banks offer free checking and savings.
6. Automatic Transfer to Savings:
Once you figure out your budget and the realistic amount that you are able to save, have your bank automatically transfer that amount to your savings every month or every two weeks and do not touch it.