How to Save Money, Even When You Don’t Have Any
Even if you have a decent job and don’t waste a lot of money, it’s possible you’re in a situation where, like millions of other people, you are living from paycheck to paycheck. You think that you’d like to save money, but it just doesn’t seem practical when every penny you earn goes toward the costs of daily living. However, even in seemingly dire situations there’s almost always a way to put aside cash in small amounts, and the benefits of having a growing accumulation of savings will end up rewarding you in many ways, both practically and psychologically.
First of all, it might be worth it to define exactly what you mean when you say you “have no money,” and then redefine it in a way that’s more amenable to adaptation. Quite often I’m amused when a female acquaintance tells me she can never afford to put any money aside because she’s always completely broke, and then I look at her and notice freshly filled acrylic nails, new Manolos, or this season’s latest Prada bag. No wonder she has no money to put aside! Let’s be clear: if you can afford to pay all your bills and have enough left over to buy designer goods and spa treatments, you’re not broke, even if you consistently have no money left at the end of each month and are gritting your teeth until your paycheck comes.
It’s amazing the lengths we will go to try to convince ourselves that certain items we buy are necessities rather than extras. Often I hear the excuse, “But I have to have these designer clothes and expensive shoes because one of the requirements of my job is to look my best all the time.” That’s understandable, but it doesn’t mean you have to spend all your extra money, every paycheck. Let’s be honest, if you’re supplementing your wardrobe every single month, you’re doing it because you enjoy it, not because it’s strictly required. But that doesn’t mean you have to give up shopping altogether — even if you just cut your fashion spending down to every other month instead of every month, think of all the extra money you’d have. I promise you, no one is going to notice if you buy new clothes every eight weeks instead of every four weeks.
Even at lower levels of income there are always extras that we quietly slip into our budgets. Of course you want to treat yourself, and that’s an important part of keeping your sanity, especially if you’re constantly stressed about money. But even something as simple as a weekly night out with your friends can end up running away with your wallet if you’re not careful. It’s not uncommon to spend fifty or even a hundred dollars or more in one evening at a club or bar, especially if parking or cover charges are involved. Think about what would happen if you passed on the invitation even one week a month, and put that money in a savings account instead — it wouldn’t seem like much incrementally, and probably you wouldn’t even really miss it, but at the end of the year you’d have enough put aside to do something really nice for yourself, perhaps take a vacation somewhere exotic. If you really want to be forward-thinking, maybe you could even use that money to start on some small investments, which in return will pay for many more vacations in the long run.
One of the keys to making this work is setting up a system where the money you set aside is no longer money you consider “available” for any reason whatsoever. This can mean a simple psychological shift, or perhaps a more physical one. Some people have enough willpower that just telling themselves the money they put away no longer exists is enough to keep them from accessing it. Other people need a little more help to forget about a pile of money as if it weren’t there. Ask your bank (or shop around at different banks), to find out what sort of savings or incremental investment options are available, and choose the one that has the most excruciating penalties for withdrawals. Preferably, you want something where withdrawing your money would end up costing you almost as much as the withdrawal is worth. It also helps if getting your money is more complicated than just logging on to the internet branch and entering your PIN number. In this case, the more of a hassle withdrawals are, the better it is for your money situation. You’ll probably think twice about your perceived need of some luxury item if getting the money for it will incur significant service charges, take three weeks, and require lots of paperwork for which you actually have to go to the bank and stand in line.
Believe it or not, saving at least some money is possible in almost every circumstance. Even if you start out with very small amounts — say, five dollars a week — by the time a year has passed you’ll have put aside well over two hundred dollars, which isn’t earth-shattering, but it’s nothing to scoff at, either. Don’t avoid saving money on the grounds that you think miniscule weekly contributions will never amount to anything. If you can gradually raise your weekly savings to ten or twenty dollars a week, even if it’s not every week, you will soon find you have a respectable cushion of cash that can be used for small investments, as well as doubling as an emergency fund. Over a period of months or years, these things can really add up. It may require some small sacrifices on your part, but the if the end result is that you end up in a better financial position overall, no doubt you’ll feel that any minor adjustments you made to your lifestyle were worth it.