It is important to contribute small amounts of money to your savings and investments, even if it’s just a dollar or a few cents a day, because over time, those small amounts turn into something big.
To get there though, follow these savings tips and advice on how to save with little money for the future you want.
Start Small
Sometimes it can be overwhelming to think about saving for a large purchase, but no matter how much money you have, what matters is getting started.
It may seem like nothing to save a few cents on something like bread by going to a cheaper grocery store. But week by week, month by month, the few cents you save on every purchase add up, and over time, if invested right, even more small amounts accumulate on top of your savings. Soon, those small savings start to look pretty big.
Create the Habit
Starting by saving small is not only about saving little pieces of money at a time—it’s about cultivating a habit. It is hard to all of a sudden cut back on your expenses, or suddenly make a lot of money to drop into a saving’s account.
Starting small allows you to start thinking about saving more often, and makes you analyze more of your purchases. Soon it will be second nature to go for a cheaper option or not spend money at all because of that saving mindset.
Savings Account
It is true that you may not make much money just by putting your stash into a saving’s account, but that doesn’t mean you won’t make anything, and it doesn’t mean there aren’t benefits to investing your money with a bank. Not only will you make a certain percentage of investment on ever dollar put into your account, but your money will be saved risk-free. Peace of mind has value too.
Set up automatic transfers so the act of saving is taken off your hands and you never miss a saving opportunity.
Invest Through Apps
No matter how much money you can spare to invest, there is an automatic investing app that will work for you. Some of the best sites are:
- Betterment
- Swell
- Wealthfront
- Ellevest
For more information, reviews and fees, check out Nerd Wallet for the best Robo Advisors of the month.
Pay Off Debts
It may not feel like paying small amounts towards your debts is accomplishing anything for your savings, but that would be very wrong. Interest rates on high-interest credit cards are often 20% or higher, while interest on student loans is often around 10%. Any amount you can pay off of your debts helps bring down the amount of money those interest rates ask of you.
Employer Match Retirement Plans
Some employers offer retirement plans in which they match the amount of money you put in. If this is the case, any small amount of money invested will pay off. You will literally watch your money double, and that is truly a great rate!
