We had an advisory call with the popular trend-hunting and consumer insights company Iconoculture the other day. They gave us some great information relative to how consumers are still adjusting to the “new normal” in 2011. The financial crisis of the past couple years has forced consumers to be more savvy and in control of everything; from spending to saving to the ways brands market to them, consumers today are much more plugged in and smarter about their behaviors in general than they were a decade ago.
So if you’re looking to be in control of and savvy with finance in 2011, we wanted to provide some tips to consider when trying to save money this year.
- Start a new habit. When that paycheck comes around, pay yourself first – in savings. Talk with your employer about setting up an automatic deposit into your savings account.
- Set goals. Start with WHY you want savings in the first place. Is it to pay down debt? Or to save for a house? Or a car? Or to have a rainy day fund? Whatever your savings goal is, put a timeline around it. WHEN do you want to have $X amount accumulated?
- Establish rules. Challenge yourself to think of 2-4 questions that you have to ask yourself before you dip into your savings account. (Example: Is this an emergency situation? When will I be able to put the money I’m taking out back in?)
- Look for rewards. Most community banks and credit unions (especially Kasasa ones) not only offer higher APYs on savings accounts, but they can also provide you with cash back, tunes, and other rewards. Megabanks like to reward you for using their credit card, while local community financial institutions like to reward you for just using your account.
- Watch yourself. We’re all guilty of spending money, but do we know how much? And on what? Thinking about a budget can be like thinking about a diet – depriving yourself of some things could make you crave and binge later. So, instead of thinking about a budget like deprivation, just be mindful of what you spend, where and on what. What have you bought today? Being aware of spending is the first step to being smarter about what you spend on.
- Retire now. Ok, don’t take this literally, but just think about it: if you were to retire today, what amount of money would enable you to do that? When you retire, you stop earning money. So when you’re in your earning years, make sure you’re contributing to a retirement fund. This is best kept separate from your savings account (#1). Do you have a 401k through your employer? If so, what are your monthly contributions? Could you increase them by 1-2% this year? While this doesn’t sound like savings at first, it IS saving you money because 401k contributions are made pre-tax and continues to grow tax-free.
- Spend time searching. The online digital world has given us a myriad of tools to help facilitate the search process when we want to find something. And if your goal is to save money, use these tools to find the lowest prices available. Oftentimes, buying something online compared to buying it in-store will save you money. While searching for the lowest price may not be the most convenient or quick way to go about things, if you want to save, it’s sure to help you achieve this goal.
- Having a smartphone in hand when you’re shopping is a sure-fire way to save you money in 2011. ABCnews covered 5 of the top mobile apps in December. Which ones did you use or could you have used?
These are only a few savings tips we thought of. What are you doing in the new year to save? We’d love to hear your tips too.